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175383921In my last post “Getting Unmarried: Gray Divorces” I wrote about the increasing number of divorces for those over the age of fifty. Also of note was how Gray Divorces have many of the same foundational issues as any divorce although there are some distinct differences. Regardless of the issues, a trained financial neutral plays a critical role in the collaborative process. Money matters can be a bed rock of tension in divorce cases. Financial issues are often cited as a major reason for marriage breakups. A financial neutral assists couples in navigating their finances. They help with the two major financial components in divorce. One is the balance sheet (list of all assets and liabilities), and two the cash flow and support. So what does a financial neutral actually do you ask.  First and foremost a financial neutral is just that – an impartial expert on financial issues. They remain unattached to any particular outcome. A good financial neutral can be worth their weight in gold when it comes to helping couples navigate money issues in divorce. Financial neutrals help a couple gather and identify the financial information needed. I often hear from spouses the detail involved in gathering the financial information is something they have never experienced. The reason for this is all assets and liabilities, each and every one, is separately noted in the final decree so as to leave no doubt who gets what and who is responsible for what. Independent third party written documentation is needed to support each asset and liability. This information gathering is a part of the process that can’t be short circuited. Having said this, when information gathering is completed by a financial neutral it can save spouses a considerable sum. Think about it. You are paying one professional, the financial neutral, to complete this process vs. each spouse providing the same information to each of their attorneys who in a non-collaborative divorce will have to review and assimilate  all the information provided, ask questions of their clients, and then likely have to converse with the other spouse’s attorney. Financial neutrals can assimilate and organize this information in a streamlined manner with the couple’s cooperation. Usually financial neutral hourly rates are less and sometimes significantly less than attorney rates. Once all financial information is collected and organized the financial neutral creates a marital balance sheet listing each and every asset and liability. The marital balance sheet forms the basis for discussion as to how each asset and liability is allocated between spouses. In the collaborative divorce process, couples make their own decisions about asset and liability allocations to each spouse.  Couples must ultimately reach agreements on the balance sheet. The financial neutral along with each spouse’s attorney helps facilitate these discussions. The alternative in more traditional litigated divorce cases is someone else, a judge, makes decisions for the couple since they are not able to agree on their own. Financial neutrals help spouse’s asses their ability to meet their reasonable living expenses (cash flow). This part of the process includes analyzing income sources and estimating future living expenses. Generally spouses are asked to complete some sort of budget template. In my experience both as a financial neutral and a financial planner, I find most people do not care for the term budget. I do a fair amount of public speaking and when I ask people what they think of when they hear the word budget it usually has a negative impression like restrictive or confining. I have attempted to remove the word budget from my vocabulary as a result and replaced it with cash flow or spending guide.  Budgets tend to be backward looking while the words cash flow and spending guide are future oriented. Assessing income and expenses (cash flow) provides each spouse with a realistic look at their financial security moving forward. Financial security is the number one goal I hear that each spouse wants to achieve. No one has ever told me they want financial insecurity. A realistic look at cash flow for each spouse is critical to providing the financial security they seek. Here is a phrase I have used when having cash flow discussions. If your outgo is greater than your income, then your upkeep may be your downfall. Think about that for a moment. Better yet remember it, as it will serve you well no matter your financial stage in life. Yes the balance sheet with its listing of all assets and liabilities and the cash flow and support pieces form the two financial pillars of every divorce. Sometimes the financial issues can become very emotionally charged. A well-trained experienced collaborative financial professional along with the help of other collaborative team members can help keep spouses on track. I encourage couples to the extent possible to look at these decisions as business decisions. It’s easier said than done but in the end it usually is a business decision. I am a firm believer that each spouse and their family are far more important than any numbers on a balance sheet or cash flow report. In my book and in my work people always come first before numbers. There are other important financial issues a financial neutral can assist with. Watch for part II of “Getting Unmarried: Money and Divorce”. There I will talk about marital and non-marital property, analyzing tax implications of various scenarios for child support and/or spousal maintenance; analyzing property and business interests, debt pay off scenarios, and comparing pros and cons of using one asset over another. Is a collaborative divorce process right for you? If you or someone you know may be looking for a divorce alternative without court click on this link to learn more:  www.collaborativelaw.org.
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135385349Sometimes what comes after the “C-word” can unfortunately be the “D-word” – divorce. The incidence of divorce/separation is unfortunately quite high after one partner has been diagnosed or is in some stage of battling cancer. If you are a woman, the odds are even less in your favor – according to a study, by the Max Planck Institute, on the effect cancer has on the divorce rate, “21 percent of female cancer patients end up divorced or separated after a cancer diagnosis.” Both a cancer diagnosis and a divorce cause such emotional devastation. You rarely think that either of these things will ever happen to you; these are things that “happen to other people.” Nancy Cox, a healing coach with the Virginia Piper Cancer Institute, sees the parallels between sitting, angst-ridden, in a doctor’s office and sitting, angst-ridden, in a lawyer’s office. “They both trigger every difficulty you’ve ever faced in your life,” Cox said. The question then becomes why? Why are so many marriages destroyed by cancer? Maybe the marriage was struggling in the first place, but often times simply the stress of cancer itself can divide a perfectly good marriage. Reassessment goes both ways in a relationship and some marriages can’t handle all the stresses and strains that cancer can bring. Dealing with a diagnosis of cancer can certainly magnify certain feelings already present, as well as create new feelings of uncertainty due to dealing with cancer itself. Big challenges like cancer, a life changing accident, other major illness, infertility, or a child with disabilities, can either bring you closer together or tear you apart. Cancer changes a person and emotionally you are in a different place after having the cancer. Sometimes fighting a battle like cancer proves to a person just how strong they are and perhaps now have the strength to leave a marriage that wasn’t quite right to begin with. Whether it’s cancer or divorce, a good starting point is to begin rallying your troops around you. Call your closest family and friends and break the news to them. Then seek out the best professionals to guide you through, whether it’s the top divorce lawyer in town, or the best oncologist. Seeking therapy is a good idea both during and after. Both cancer and divorce also offer the potential for healing. “Any crisis creates opportunity, if one can re-frame it and get the level of support needed to have that happen,” Cox said. Once you battle cancer, divorce, or both, you are forever a survivor.
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98680904Cash flow refers to how your money moves in your household, from the time it is received to when it is spent. When your cash flow is “positive,” it means you have more money coming in than going out; you are spending less than you take in each month. You want positive cash flow in order to pay for expenses and also save and invest money for goals. After a divorce, however, you may find your cash flow is tight or even negative. That is, you are spending your cash almost to zero each month or spending even more than you take into the household. To improve your cash flow, here are several steps to take: 1. List all your sources of income. Your income could include any of the following:
  • Spousal maintenance/alimony
  • Child support
  • Part-time and full-time wages, bonuses and commissions
  • Self-employed income
  • Rental income
  • Royalties
  • Investment income
  • Pensions or draws from retirement accounts
Different sources of income are taxed differently, so you need to know your true after-tax income. Consult a CPA or financial advisor to learn more about this. You’ll also need to know how often you receive each source of income and if it’s fixed/guaranteed (paychecks) or variable (self-employment income). 2. Determine your historical monthly spending. Look back 6-12 months to get an accurate picture of expenses. This could include everything from car or home maintenance to vacations, kids’ sports activities or insurance premiums. Look up spending summaries on your Quicken account or request statements from your bank or credit card companies. Don’t make yourself crazy trying to document every expense to the penny. Just come up with a monthly average per expenditure (e.g. $1,000 on holiday gifts averages out to about $83 a month). Reviewing your spending habits can be a valuable exercise. You’ll likely see areas where you could realistically cut spending in order to improve your cash flow. 3. Decide if positive cash flow requires more income or less spending – or both! There are only two ways to improve cash flow: increase your income or reduce spending. You can increase income by finding a job, increasing the hours you work or finding a different job with a better salary. You could also consider returning to school to train for a better-paying job. Temporary jobs, such as retail during the holiday season, can also provide a cash cushion to meet immediate or pressing needs. If you are already working as much as you can, then look for ways to cut spending. Divide your expenses into fixed expenses (like rent or mortgage), escrow expenses (such as insurance or taxes), and living expenses (groceries, haircuts, school expenses). It is often in the living expenses category that you can find areas to cut — at least short term — in order to create a more workable budget and money habits. Keep going back to this list and making cuts until your budget is less than your income. If you are in the habit of using credit cards as your cash overflow account and aren’t paying off the balance each month, this is another sign that you may not have positive cash flow. Stop using credit for any living expenses and give yourself a cash allowance instead. You will quickly assess needs and wants by looking at the remaining cash in your wallet as the weeks go by. Be gentle with yourself. A new cash flow system takes 30 to 90 days to start showing positive results. Staying in a budget takes practice, but can become fun as you have more money to save for vacation or that retirement dream.
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168408173In my last blog I wrote about how people travel all around the world to learn about how we Collaborative divorce in Minnesota. In this blog, I want to say a little bit about why that is true. Describing all of the elements of Collaborative Divorce would require more than we could put in one blog. I want to focus on the one element that may stand out above the others: choice. People who face family conflict need choices. Collaborative Divorce takes everyone, including the lawyers outside the court system, so that there is complete freedom for each family to design a process that truly meets their unique needs. Once people arrive at that place where true choices can be made, there are many options. Here are some examples of choices people can make in the Collaborative Process:
  • People can choose to have a parenting expert help them with their children rather than leaving the parenting issues divorce lawyers.
  • People can choose to have a financial expert teach them about how to handle finances better rather than just fight over who gets the bigger slice of the pie.
  • People can choose to improve their communication, and even, if possible improving their respect and trust of each other, by getting the emotional support that they need.
  • People can choose to focus on their highest goals, like reducing conflict and can avoid getting caught up in minor issues.
  • People can even choose to put the divorce on pause, if appropriate, to give them time to look at their marriage and determine whether they want to work on reconciliation.
When families are in conflict, trying to fit that conflict into a narrow “one-size fits all” system, can lead to outcomes that do not address true needs. Stepping outside the shadow of the courthouse and letting families design their own course leads to better outcomes. Divorce is difficult. The choices that you make during this important time could affect your family for decades. Before you take the first step, explore all of your options. To find out about the Collaborative option, go to www.collaborativelaw.org.
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471951467Recently I participated in a case debrief with other members of a Collaborative team.  The debrief, or case consultation, is a regular and ordinary part of Collaborative Team Practice.  Any team member can request a debrief to get an update or deal with an emerging issue, or they can be regularly scheduled by the neutral coach as part of team practice.  I usually don’t think twice about how remarkable these discussions can be.  But it is important to occasionally reflect on what makes Collaborative Team Practice uniquely able to tailor problem solving to the needs of clients. The issue we were addressing as a team was how to best support a divorcing couple to deal with hurtful and contentious behavior by extended family.  This is not an uncommon concern.  It can be difficult for extended family and friends to know how to behave during a divorce, and many default to taking sides.  This can aggravate an already painful situation, especially for children who find themselves in the middle when listening to an aunt, uncle, grandparent or other family member who is critical or dismissive of one parent. This issue had arisen several times while creating a parenting plan.  Because parents were working with me as a neutral child specialist, it was possible for us to generate options in an open way, e.g. inviting extended family members to a meeting with me to talk about the goals of Collaborative Team Practice and the importance of keeping kids at the center and out of the middle.  Parents and I agreed I should discuss their concerns and potential options with their team. In the team debrief, the attorneys and neutrals working with this family continued to openly address this issue with a problem solving approach, and more options were generated for supporting our clients and their children. Each team member was able to contribute nonjudgmental, constructive perspective and empathetic support.  We shared the commitment to assist our clients through a challenging time. In a different kind of divorce process, it would have been difficult to have such an open discussion about an issue with such potential to be polarizing. Team debriefs are clearly one of the strengths and value-added dimensions of the Collaborative Team Practice model.
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144313218It was actually my wife’s idea. Lose the clunky stand-alone bookshelf on the second floor landing and build in a bookcase that wraps around the stairwell. Four years ago, her father called a buddy with a sawmill up north. The buddy sold us an oak tree. Then he quarter-sawed it into planks, delivered it to my father-in-law’s shop, and in a matter of months, we had a stack of lumber that was milled to provide tops, bottoms, sides, and shelves of a bookcase. Some assembly required. “I’ll do the finishing,” I said. “I don’t want this to be a slap-dash job.” It wasn’t. Weeks turned into months. Months turned into years. The rift and quarter-sawn white oak was sanded. It was filled and sanded again. It was stained. It was varnished.  Multiple times. The varnish was sanded down to even it and provide a smooth base for the next coat.  And the next. And the next. “Are you ever going to finish those bookshelves?” my wife asked. “No sense paying someone to do something I can do myself,” I responded. This week, as her uncle and I measured, re-measured, plumbed and leveled and trimmed out and touched up the enormous room elephant that this project had become, I shared my frustration with a colleague. “I swear that’s the last time I volunteer on a home project!” I told him. “It’s not like I couldn’t do it. The finish work is gorgeous, if I do say so myself. But the time! I swear I would have been way ahead of the game if we had just hired someone to begin with.” “Kind of like a pro se divorce, isn’t it?” he quipped, referring to the 80% of divorces where the couples don’t use any lawyers to assist them. “As I recall, you don’t do a lot of wood finishing, do ya?” “Some” “Ya learned a lot ya didn’t know before, sounds like.” “The understatement of the year!” “Like I said, sounds like a pro se divorce!  Hey, I know ya got “skills,” but how much time did ya give up, and how much of it did ya have to do over ’cause ya didn’t get it right the first time?” “Don’t ask!” It’s not that I don’t know why those 80% try to do it themselves.  I get that!  Last week I helped a woman who did it herself.  She also transferred part of her retirement to her Ex.  But she made a mistake and had to do it over.  This time, the Ex had a lawyer handle the transfer order.  And she had me look it over to be sure it was all in order, which it was. I probably should have hired you in the first place,” she said when we were done.  “Thanks so much!” It had a familiar ring.
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176725719Every couple and every divorce is different. A divorce is often a complicated process involving emotional and financial elements. While there is no universal process for divorce, there are some common mistakes. Indeed, if a divorcing couple could avoid these mistakes, they would be very well on their way to a respectful process with the best possible outcomes. 1. It is a mistake to have unreasonable expectations. You will not “win” on every issue. In fact, a collaborative divorce results in mutually agreeable resolutions. The work is not about winning or losing, it is about working to come up in resolutions that are acceptable to both spouses.  What matters is looking at the big picture and working toward a resolution together so that you don’t fall into the trap of seeing every decision as a win-loss issue. 2. It is a mistake to let your emotions rule you. A divorce is a very emotional process.  This is understandable and a part of the process. During a divorce, you need to try and make decisions in your own best interest. Decisions out of anger or frustration may not be as long-lasting. Try to find a support network and a professional team to support you to make decisions that feel right and have long-standing value. 3. It is a mistake to not deal with your finances. An important thing to focus on is your finances. In addition to dividing up the financial assets/liabilities and property you have, it is important to think about the tax implications of your divorce.  You want a support team in place that thinks about all of the financial necessities and comes up with workable and predictable resolutions that work. 4. It is a mistake to not consider a collaborative divorce. It is important to recognize that there are various process options available to you in a divorce. Even if both parties in the divorce want nothing but for the marriage to end, it is important to remember that your situation is as unique as your marriage was. A collaborative divorce may work best for you and your spouse. It will allow you to work together to determine how the marriage will end, how your assets will be divided and how child custody will be decided. This type of dissolution isn’t solely for couples who are parting amicably and have little to divide; many couples work with each other collaboratively during a divorce so that the have control of the process and how to settle property and custody issues.
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482285789I recently attended a symposium about divorce entitled, “What’s Love Got to Do With It?” At first glance you might wonder whether we had anything to talk about. What do love and divorce have in common? Isn’t divorce the result of the loss of love? Sharing ideas with others interested in improving the divorce process reinforced my belief that love, forgiveness and compassion are the keys to divorcing well, and that divorce can indeed be a healing process. Divorce is an all-too-common event these days. We all have friends, family members, neighbors and co-workers who have experienced becoming unmarried. Some just barely survive and are stuck looking back at their divorce with regret and resentment. Years later they continue to bad-mouth their ex and blame their divorce for their ongoing unhappiness. Their inability to be present and available has long-term consequences for their children as well. Most of us also know people who not only survive, but thrive in their post-divorce lives. They are somehow able to accept the major changes in their day-to-day lives and move forward. By doing so, they are healthy role models for their children and fun to be around.  What accounts for these vastly different outcomes? Personality certainly has something to do with it. Some humans are blessed with more optimistic outlooks than others. Seeing the glass half full reduces anxiety about the future. Life circumstances also play a role. Good health, steady employment, and a healthy balance sheet contribute to feeling better about what lies ahead. However, several decades of experience tells me that one factor trumps everything else in terms of one’s ability to recover from divorce … the ability to forgive. Anger, bitterness, blame and resentment are feelings associated with the loss of a loving relationship. Grieving the loss is necessary in order to get on with life. Tara Brach, a leading western teacher of Buddhist meditation, emotional healing and spiritual awakening, who was a symposium presenter, says, “Vengeance is a lazy form of grief.” Rather than being lazy and stuck, working through one’s grief with a therapist, clergy person, or trusted friend can lead to understanding and forgiveness. Acknowledgment and forgiveness of one’s own contributions to the divorce are essential, as is forgiveness of the other person. In the Collaborative divorce process, our professional team includes a neutral coach and a child specialist, both of whom assist the parties in reaching closure with regard to their marriage and defining their future co-parenting relationship. “When you forgive somebody who has wronged you, you’re spared the dismal corrosion of bitterness and wounded pride. For both parties, forgiveness means the freedom again to be at peace inside their own skins and to be glad in each others’ presence.” -Fredrick Buechner
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175383921In my last post “Getting Unmarried: Gray Divorces”  I wrote about the increasing number of divorces for those over the age of fifty. Also of note was how Gray Divorces have many of the same foundational issues as any divorce although there are some distinct differences. Regardless of the issues, a trained financial neutral plays a critical role in the collaborative process. Money matters can be a bed rock of tension in divorce cases.  Financial issues are often cited as a major reason for marriage breakups. A financial neutral assists couples in navigating their finances. They help with the two major financial components in divorce. One is the balance sheet (list of all assets and liabilities), and two the cash flow and support. So what does a financial neutral actually do you ask.  First and foremost a financial neutral is just that – an impartial expert on financial issues. They remain unattached to any particular outcome. A good financial neutral can be worth their weight in gold when it comes to helping couples navigate money issues in divorce. Financial neutrals help a couple gather and identify the financial information needed. I often hear from spouses the detail involved in gathering the financial information is something they have never experienced. The reason for this is all assets and liabilities, each and every one, is separately noted in the final decree so as to leave no doubt who gets what and who is responsible for what. Independent third party written documentation is needed to support each asset and liability. This information gathering is a part of the process that can’t be short circuited. Having said this, when information gathering is completed by a financial neutral it can save spouses a considerable sum. Think about it. You are paying one professional, the financial neutral, to complete this process vs. each spouse providing the same information to each of their attorneys who in a non-collaborative divorce will have to review and assimilate  all the information provided, ask questions of their clients, and then likely have to converse with the other spouse’s attorney. Financial neutrals can assimilate and organize this information in a streamlined manner with the couple’s cooperation. Usually financial neutral hourly rates are less and sometimes significantly less than attorney rates. Once all financial information is collected and organized the financial neutral creates a marital balance sheet listing each and every asset and liability. The marital balance sheet forms the basis for discussion as to how each asset and liability is allocated between spouses. In the collaborative divorce process, couples make their own decisions about asset and liability allocations to each spouse.   Couples must ultimately reach agreements on the balance sheet. The financial neutral along with each spouse’s attorney helps facilitate these discussions. The alternative in more traditional litigated divorce cases is someone else, a judge, makes decisions for the couple since they are not able to agree on their own. Financial neutrals help spouse’s asses their ability to meet their reasonable living expenses (cash flow). This part of the process includes analyzing income sources and estimating future living expenses. Generally spouses are asked to complete some sort of budget template. In my experience both as a financial neutral and a financial planner, I find most people do not care for the term budget. I do a fair amount of public speaking and when I ask people what they think of when they hear the word budget it usually has a negative impression like restrictive or confining. I have attempted to remove the word budget from my vocabulary as a result and replaced it with cash flow or spending guide.  Budgets tend to be backward looking while the words cash flow and spending guide are future oriented. Assessing income and expenses (cash flow) provides each spouse with a realistic look at their financial security moving forward. Financial security is the number one goal I hear that each spouse wants to achieve. No one has ever told me they want financial insecurity. A realistic look at cash flow for each spouse is critical to providing the financial security they seek. Here is a phrase I have used when having cash flow discussions. If your outgo is greater than your income, then your upkeep may be your downfall. Think about that for a moment. Better yet remember it, as it will serve you well no matter your financial stage in life. Yes the balance sheet with its listing of all assets and liabilities and the cash flow and support pieces form the two financial pillars of every divorce. Sometimes the financial issues can become very emotionally charged. A well-trained experienced collaborative financial professional along with the help of other collaborative team members can help keep spouses on track. I encourage couples to the extent possible to look at these decisions as business decisions. It’s easier said than done but in the end it usually is a business decision. I am a firm believer that each spouse and their family are far more important than any numbers on a balance sheet or cash flow report. In my book and in my work people always come first before numbers. There are other important financial issues a financial neutral can assist with. Watch for part II of “Getting Unmarried: Money and Divorce.” There I will talk about marital and non-marital property, analyzing tax implications of various scenarios for child support and/or spousal maintenance; analyzing property and business interests, debt pay off scenarios, and comparing pros and cons of using one asset over another. Is a collaborative divorce process right for you? If you or someone you know may be looking for a divorce alternative without court click on this link to learn more:  www.collaborativelaw.org
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500048813Becoming friends with your ex? Or even friends with your ex’s new boyfriend/girlfriend? Do these friendships sound impossible to attain? Perhaps there is something to be learned from the infamous Tiger and Elin Woods’ divorce. Elin recently went on vacation with Tiger, their two kids and Tiger’s current girlfriend, Olympic skier, Lindsey Vonn. The modern blended family – where friendships, and even vacationing together can happen successfully. If befriending seems like a long-shot for you, try to put bitterness and grudges aside when you consider that new boyfriends/girlfriends/spouses will be around your children, whether you like it or not. Co-parenting is not easy, and it will take time and effort to find the right grove in your new lives. Daisy Camp recently hosted a co-parenting workshop at the Collaborative Alliance, titled “One Bridge to Peace,” where co-parenting tools were provided that allow even one willing, caring parent, to relate peacefully with even the most bitter and contentious co-parent. Depending on how newly divorced you are, joining each other on vacations may seem like a long-shot, but remember, even introducing yourself and keeping the lines of communication open with you ex’s new companion can go a long way. Who knows, maybe someday you’ll find yourself vacationing in the Bahamas or at Disney with your ex!