Divorce Done Differently by Denise French
What’s a man to do? You’ve decided to divorce and now you are finding that there are multitudes of services that cater to helping women during a divorce. Granted, we still live in a society where the more-likely scenario is that the husband has handled the finances during the marriage and the wife needs a little more hand-holding. But this is not always the case and men can struggle to find the resources they need.
Even if you have handled your family finances for the entire marriage, you still need to be sure you understand your financial options as well as your legal ones. With the help of the right financial expert, you’ll find there are still some helpful tax laws that can make a creative and amicable settlement very appealing. The following are some common mistakes in divorce to avoid that, in my experience, has saved lots of money for my clients!
Mistake #1: Thinking that the assets are all yours because she didn’t work.
Oh, this is so hard!! You have fought rush hour traffic, dealt with stressful deadlines, clients and bosses. You’ve hired and fired people. You may have enabled your wife to stay at home and raise your children (and maybe play tennis with her friends). You have contributed a lot!! However, and this is hard, it’s not all your money. Texas is a community property state which means that half of every dollar that enters the house via income during the marriage belongs to you and half belongs to her – no matter if it went into the house, the bank, the 401(k) or any other asset. It’s a marital property issue. Even if you begged your wife to get an outside job for years and years and years and she just refused. Grab a beer with your buddies, bark about it (I understand) but in the end, it is what it is. The more you fight that the more you are going to waste money.
Mistake #2: Making promises too soon.
One of the most common mistakes in divorce is making promises too soon. I see this so often. DO NOT MAKE PROMISES BEFORE YOU KNOW THE FACTS!! She will hold you to them until her last dying breath even if they are unreasonable, unjust and even unattainable. Do not tell her you will give her anything until you know the law, your rights, her rights and your living arrangements/budget post-divorce. Do not, out of guilt, tell her you will financially take care of her for the rest of her life and make sure she is okay because she will remember that, and it will be brought up again and again. You are also hindering your wife more than helping her by promising things you cannot or will not keep. If you have children, you are going to co-parent for the rest of your lives. Don’t start that post-divorce parenting relationship by promising things you cannot or will not deliver. It hurts her and it hurts you. Don’t do it.
Mistake #3: Refusing to give up retirement accounts.
A lot of times, men get emotionally attached to pensions and retirement plans and will negotiate a settlement that lets them keep those assets. I understand it is a reward you’ve earned for a lifetime of hard work. But remember, both pensions and retirement assets are taxable income when you receive them. If you are earning significantly more money than your spouse for most of your life, chances are you will always be in a higher tax bracket than her. Take advantage of this fact and give her the ENTIRE settlement in retirement assets adjusted for HER tax rate instead of yours. This strategy has saved couples that I work with tens of thousands of dollars in taxes and they get to share in the benefit.
Mistake #4: Being a bully.
Our society has come a long way on how we regard bullying. Even with that knowledge, fear can show up in the negotiation process as anger and I see lots of men that make the mistake of thinking that being angry will strengthen their case. Gentlemen, it’s just a bad, bad idea. You’re both scared. Make sure that you work with a CDFA® practitioner, or Certified Divorce Financial Analyst® practitioner that will incorporate future financial planning into your settlement negotiations and everyone’s fears can be addressed fairly.
Mistake #5: Not asking for help.
The last tip I have for you is to realize that you don’t know what you don’t know. Men are often motivated by saving money and will attempt to have a do-it-yourself divorce where they draw up their own paperwork. Bad, bad, bad idea. There are so many intricacies, both financial and legal, to the divorce process that you will save thousands of dollars by making sure that you cover all the bases the first time. At the very least, consult a professional to be sure your decree is enforceable.
Denise founded Divorce Strategies Group in 2014. Divorce Strategies Group was incepted because of her own ugly divorce in 2007. Denise desired to create a firm where others could have a better divorce experience, and to help other children not face the trauma her own child experienced. She helps other walk through the divorce process in a dignified, confident manner.
Denise is a Certified Valuation Analyst® (CVA®), a Master Analyst in Financial Forensics® (MAFF®), a Certified Divorce Financial Analyst® (CDFA®), a Family and Child Custody Mediator and trained as a Collaborative Law Financial Expert. Denise focuses on the areas of divorce finance, divorce tax, separate property tracing, executive compensation in divorce, pension plans, expert witness testimony as well as the emotional aspects of divorce.
Denise also founded French Financial Group in 2012. Prior to French Financial Group, Denise worked as a regional sales executive for large investment and insurance firms. She has over 22 years of experience in financial planning, investment positioning, and income strategies. She currently provides full-service financial planning, investment placement and insurance as an Investment Advisor Representative (IAR) under French Financial Group. Denise is also a Chartered Retirement Planning Counselor (CRPC).