Frequently Asked Questions
Who hires you?
A Certified Divorce Financial Analyst® (CDFA®) is usually hired by a divorcing client. Sometimes an attorney hires a CDFA® as an expert witness on behalf of the client.
Do I have to meet you with my spouse?
No. We can work with both parties but separately, with couples together, or with only one spouse. If we are hired to be a neutral advisor, then all information is disclosed to both parties.
How much does it cost to work with you?
We start with a complimentary 30-minute consultation. During this first phone call or meeting we will review your situation together. After this initial review we will be able to give you an estimate that is specific to your unique needs, along with guidance on what to expect as we work together.
How do I prepare for our first meeting?
The first step in preparing for our meeting is to gather as much documentation related to your finances as possible. This would include pay stubs, bank statements, investment account statements, titles and deeds, estate plans, credit card statements, mortgage documents, car loans, etc. Here is a helpful Getting Started Checklist that will help you start to think about all the issues we will be discussing. You may also find this Priorities Worksheet useful.
Why is it important to have a CDFA® involved in our divorce? Won’t that just cost more?
In our experience, making sure financial matters are managed the best way possible right from the beginning is always less expensive than trying to go back and get something fixed or changed. A Certified Divorce Financial Analyst® is trained to help people through the maze of divorce. They sift through the financial issues including incomes, expenses, assets, tax issues, pensions, division of property, and help you reach an equitable solution that is fair to both parties. A CDFA® professional has specialized skills and experience that enables him/her to analyze financial issues in divorce in their long-term context. A CDFA® can take the offer on the table and project out 5, 10, 20 years to show you what you will have to live on if you sign the agreement.
Why can’t I just work with my CPA or existing financial planner?
Your current advisor or tax expert typically has been working with both of you. It is a conflict of interest for either professional to work with a couple who is divorcing and has been hired by both parties. The role of the financial planner is to help people achieve their financial goals regardless of whether they are divorcing or happily married. After determining the client’s goals, the next step is to take an inventory of current assets and liabilities and then the planner looks at what needs to be done to achieve the client’s goals.
Conversely, an accountant or CPA typically looks at the details of a financial scenario as it is today and makes no future projections for each of the parties. In a divorce, they are hired to calculate the tax effect of dividing property and the effect of spousal and child support for one or two years. They typically do not project further into the future. They may also be retained to perform an audit of account activity or to perform forensic accounting functions to help find “hidden assets.”
To best meet the needs of divorcing people, you need a blend of assessing the financial situation in the present and projecting for future needs and goals; the CDFA® designation was created to fill this role. The responsibility of the CDFA® professional is to assist the client and their attorney to understand how the financial decisions they make today will impact the client’s financial future based on certain assumptions. That way, the client can make informed decisions about their financial future.
What is marital property?
Marital property or community property is property that was acquired during the marriage years. Typically gifts and inheritances are excluded unless they are “co-mingled”. A CDFA® can help you identify marital property and personal property.
I know my spouse is hiding financial assets, how do we find them?
We can assist you with tracings or financial audits to find hidden assets.
Will I get spousal support and if so, how much will I get?
Spousal support is determined by a variety of factors: incomes of both parties, the support needs, ability of one party or the other to pay, health and current lifestyle, and the state you live in, just to name a few. Working with a CDFA® will help you understand the cash flow requirements for both paying and receiving support.
How much child support will I get?
In the USA, every state has Child Support Guidelines that are mandated by the state. However, the guidelines are trickier to apply when one (or both) spouses is an independent business owner who can control their wages. In this situation, we typically look at the income potential of both parties.
What is a QDRO and why do I need one?
A QDRO is a Qualified Domestic Relations Order. A QDRO is needed for pension plan, 401k and defined benefit plan divisions. After a divorce is finalized, this action form is required for executing the agreed division of plan assets.
My home mortgage balance is higher than the fair market value of the home? How does this work in a divorce?
There are numerous options that we can look at. We can help you establish a business contract between all parties.
How can you help me after the divorce is final?
You may think that once you have signed the divorce paperwork you are finished with the divorce process. However, the divorce terms and divisions now have to be executed. A CDFA® can help you with transferring assets, changing titles, assisting with QDROs and other additional tasks. Then you will start to focus by looking ahead to your new financial future – we can help you with planning, budgeting and setting new goals.