Monday, October 22, 2012

What If You Don't Really Want a Divorce?

Just like it takes two to tango, it takes two to have a marriage.  If one person wants out of a marriage, the other one can't really prevent a divorce.  Both parties have to be committed to keep a marriage together. 

It often happens that one spouse decides to seek a divorce before the other spouse is even aware of that possibility.  People frequently think through their marital problems and come to the conclusion or realization that a divorce is what they want, all without involving their spouse in the deliberations.

The result is that one party is often surprised and unprepared for a divorce.  That party also often wants to try to preserve the marriage.  If you find yourself in that position, here are some things to think about.

1.  Get some counseling with a good professional counselor.  Look within yourself and your marriage.  Do you really not want a divorce?  Is it possible, after the shock wears off, that you also might be better off ending the marriage?  Have you overlooked the signs of discontent or problems in the relationship?  How committed is your spouse to the divorce?  Try to review the situation as objectively as you can, but depend on help from a good counselor.  This is not something you should try to deal with on your own.

2.  Is your marriage past the point of no return?  If you want to save the marriage, don't burn the bridges by your reaction to your spouse. You need to figure out if there's still something valuable to salvage and build upon.  If you spouse is having an affair or living with someone, the odds are that you can't resurrect the marriage.  Be realistic.  If your spouse has hurt you financially, emotionally or physically, it may be best to cut the ties.

3.  If you want to preserve the marriage, here are some ideas. 
  • Recognize that divorce is inevitable, if either one of you wants it.  You may be able to slow it down, but you really can't stop it, if your spouse is persistent.
  • Don't burn your bridges.  Be nice to your spouse.  Being mean or destructive is not going to win back your spouse. You may have to work on the divorce while you are trying to get your spouse to reconsider.
  • Be fair to yourself.  Don't rollover in a settlement.  Giving your spouse everything, or most things, will not win him or her back.  That strategy just doesn't work.  Don't give away the farm.  I have seen that happen and then the other spouse still goes through with the divorce.
  • Make it clear that the door is open and you're willing to work on issues, if your spouse is.  It must be a two-way street.  Your spouse has grievances against you, at least some of which are legitimate, and you will also have grievances against your spouse, at least some of which are legitimate.  If your spouse takes the position that you must unilaterally make all the changes, that's not going to work and you won't like the outcome.
Reconciling is a huge up-hill battle.  Don't expect an easy or smooth trip.  Be prepared to invest a lot of emotion and effort and even then, it may not work. 

  • If your spouse says it's all your fault.
  • If your spouse has acted dishonestly.  Or,
  • If your spouse demands a deal very unfavorable to you, before he/she will talk with you.
If any of those situations occur, go see a divorce lawyer.

Sunday, October 7, 2012

Divorce Over 50: Checklist of Financial Issues

For various reasons, many Baby Boomers seem to be facing divorces even after long marriages.  Sometimes both parties reach the point where they want to end their marriage.  Other times, it's one spouse or the other who takes the lead in deciding to divorce.  Even if just one spouse wants the divorce, in Texas the divorce will ultimately be granted if that spouse persists.

Whether divorce represents welcome relief or a distasteful experience that can't be avoided, both parties need to prepare.  The following is a list of financial issues that come up in most divorces after long-term or later-in-life marriages.

1.  Planning for Retirement.  While not everyone has a retirement plan or assets set aside for retirement, it should be a concern for everyone over 40.  The degree of urgency may vary, depending on how far away from retirement each party is.  The tax aspects must also be considered for each type of asset.  Preparing a future budget and working with a financial advisor will be helpful.

2.  Planning for Transition.  This is the transition from being married to single and also may include the transition from working to retirement.  Very often, one spouse has stayed home to take care of children.  That spouse may need some time to get back in the job market and get hired, and may need some education.  Our economy is not yet back to full speed, so finding a job is not as simple as it was a few years ago.  That means that support may need to be a component of the settlement.

3.  Dealing with Health Issues.  Being part of an older age group naturally means that there will be health concerns.  Additionally, health insurance will have to be provided for.  Health issues can affect whether one or both spouses are able to be employed.

4.  Making Living Arrangements.  The divorce may be coming at a time when the parties might have been downsizing anyway, but selling a house is often part of the discussion.  One or both parties may have to find suitable and affordable housing.

5.  Taking Care of Children.  Depending on the children's ages, there may be private school, tutors, college or other education-related expenses.  Then  there's extra-curricular activities.  They have to be coordinated and paid for.  If the children are young, child support and visitation will have to be resolved.

6.  Separating Credit.  Often, one spouse has a better credit record or more income and the credit purchases have been made primarily in that spouse's name.  Joint credit cards need to be separated.  Some debts might be paid off, or they may be allocated in the property division.  A spouse might need to set up some new separate credit cards or accounts while they are still married and there is joint credit to qualify for the accounts.

7.  Managing Debt.  The  parties both need to prepare budgets for the interim while they get divorced and for their post-divorce lives.  Splitting debt 50-50 doesn't make sense if one person has very little earning potential and the other one has high earnings.  The parties need to be realistic.

8.  Allocating Investments.  Each party will probably want or need some investments, if there are some.  They should carefully evaluate the level of risk with each investment.  The parties also need to consider whether the investments promise short-term income or long-term value, and try to fit the investments with each party's needs.  Another factor to consider is how capable each party is to manage the assets.

9.  Updating Financial Planning.  Everyone should have a will and the wills have to be revised after divorce.  Other instruments, such as trusts, insurance, retirement assets, stocks and bonds, real estate and other investments will need to be revised or reconsidered.  You should work with a financial planner who helps people going through divorces.

10.  Providing for Legal Fees.  Since you will be going through a divorce, you will need a divorce lawyer.  Unfortunately, sometimes one party will try to prevent their spouse from hiring a lawyer.  Even in the most agreeable divorces, each side should have their own attorney to review the situation and advise the client.  One way or another, there's usually money available in assets, bank accounts or credit cards that can be used to hire an attorney.  Don't let your spouse talk you out of it.

Most people do a little research and think about the issues before they go see a lawyer about  a divorce.  This list will give you a starting point.  There are probably some issues not covered that may come up in your case.  Be prepared to discuss these and other issues with your lawyer at your first meeting.  Good luck!