Alimony from Wives: It's No April Fool Joke

In a recent post, Dan Nunley, of the excellent Oklahoma Family Law Blog, discussed a recent trend that appears to be slowly building. He cited and reprinted an April 1, 2008, Wall Street Journal article about men receiving alimony from their ex-wives. It appears that in about one in three marriages, the wife earns more than the husband does. If those couples divorce, the wife has a possibility of being ordered to help support her husband after the divorce and that apparently does not sit well with some of the wives who are in that situation. Interestingly, the comments and complaints of some wives paying alimony sound just like comments and complaints some men make when they pay alimony.

As you may know, after a long history of no court-ordered alimony, Texas does permit alimony to be ordered. It has long been possible for the parties to agree upon alimony as part of an overall divorce settlement. There are a number of reasons why parties may reach an agreement for the payment of alimony and it is becoming a more prevalent tool to help reach an out-of-court settlement in marriages which have either a high wage earner or significant assets or both.

Where the parties cannot agree on alimony, a party (wife or husband) can ask a judge to order alimony, but the law is very restrictive in qualifying someone to receive alimony and usually permits it only for a short period of time. There are few situations in Texas where significant court-ordered (and not agreed to by one of the parties) alimony can be ordered, so the situations described in the Wall Street Journal article don't occur in Texas to any degree. Here, court-ordered alimony requires more than just a difference in income or fault in the break-up. Basically, if the party is able to support herself or himself or has assets that can provide the means to support the person, a court is generally not going to order alimony. Also, if alimony is court-imposed (not by agreement),
it will generally be no more than $2,500.00 per month and last for up to three years.

Nevertheless, it should not be surprising in the next few years to see more husbands seek alimony from their spouse for the same reasons wives have traditionally given when they have sought alimony. And we can probably expect the same responses from wives that we have gotten from husbands over the years as they protest the awards. In the end, the same reasons that support alimony from husband to wife can support alimony from wife to husband. A more significant trend will probably be the use of alimony as a tool to help settle substantial property or income divorces in a way that benefits both parties.

What is a Rule 11 Agreement?

You may have noticed that sometimes lawyers tend to slip into legalese in court or when talking with clients or others. To be charitable, using legal terms may be an attempt to be precise, but it still tends to hamper communication with laypeople. A phrase that often comes up in family law cases, but which is often not explained, is "Rule 11 Agreement".

A Rule 11 Agreement is an agreement which is made in compliance with Rule 11 (no big surprise there) of the Texas Rules of Civil Procedure. Rule 11 says that an agreement between the attorneys or parties involved in a law suit can be made enforceable and binding in one of two ways:
(1) if it is in writing, the agreement must be signed by the attorneys or parties making the agreement and it must be filed with the papers of the Court; or
(2) if it is not in writing, the agreement must be made (stated) in open court (while court is in session) and made part of the official record of the case.

The Rule 11 Agreement must be clear and complete. Written agreements can be typed or hand-written. If oral, the record must show that all parties consented to the agreement.

Rule 11 Agreements are used for many different issues when agreements are made during the course of a case. For example, there might be agreements on the amount of child support, a visitation schedule, when documents will be exchanged, how bills will be paid, who gets to claim the tax exemptions, and so on. They can save time for everyone and the requirements of clarity and specificity help ensure that everyone knows and understands the agreement. Done properly, the agreements are binding and can prevent a party from trying to back out of an agreement. They are frequently used when the parties are negotiating at the courthouse and operate to preserve agreements made in the course of settlement talks.

Rule 11 Agreements are a common, ordinary device to help resolve legal issues outside of court. If you are involved in a family law case, you should not be surprised to see the terms of various agreements preserved as a Rule 11 Agreement.

Tips to Help You Get a *Fair* Divorce

Yesterday, J. Benjamin Stevens, in one of my favorite blogs, the South Carolina Family Law Blog, had an interesting post with some good ideas to help you attain a good result from a divorce. There are some differences between Texas and other states' laws, but many of the points are very appropriate for anyone facing a divorce. Here is what he wrote, along with a few comments of mine

"The following tips can help you get a fair divorce and save you a great deal of time, stress, and money:

• "Once you have made the difficult decision to end your marriage, begin to focus on the financial issues as soon as possible." That's excellent advice. It may take a while to gather the records you need and the finances are very important both immediately and in the long run.

• "Get a good attorney to ensure you receive an equitable settlement, and get the best attorney that you can afford." That is very important. I have previously written about how to choose an attorney. You should make sure you have one who is qualified for the type of issues in your case. Experience and local knowledge are very important. Usually, a Board Certified Specialist in Family Law is a very experienced and knowledgeable attorney in that field.

• "Remember that most states determine the value of the marital assets (including retirement accounts) based on the date the case is filed with the Court." That is not correct in Texas. Here, the value is determined at the date of division. If there are losses or gains in value (for example, stocks or retirement accounts) after the date of separation or the date of filing, they are taken into account when the value is determined by a judge on the trial date. If a case is settled in negotiation, the attorneys usually try to use the most recent values of assets and debts.

• "Consider when to file your case and whether it might be worthwhile to file sooner or later if you know when significant financial events will occur, such as receiving a bonus at work." Usually, that is not a factor in Texas since the value of the estate is determined at the time of division and there is a 60 day waiting period, beginning with the filing date, until the divorce can be granted. Occasionally, the date of filing can be significant, but most often timing can be affected by health, safety, emotional stability, financial need, or some other factors which can come into play. Sometimes filing is delayed so that the other party can adjust to the idea of divorce. Someone about to file for divorce should consider the whole situation before jumping into the process.


• "If the mortgage is listed in your name (or both names) and your spouse will receive the house, insist that he/she refinance to remove your name from the mortgage as soon as possible." That is a good way to protect your credit. Leaving the house in both names without changing the mortgage is really dangerous.


• "Make copies of all recent financial statements, so that your attorney will have an accurate listing of the accounts, balances, etc." I would include virtually all financial documents, including all credit cards, bank records, stock information, retirement account records, and any other financial records. Gather up for your attorney all the records you can find and let the attorney decide what is needed and useful.

Original "Source: "Parting Ways? Your Guide to a Fair Divorce" published in the Erie Times-News."

Bonus Comment: I recommend that you avoid using the word *fair* in discussing anything to do with divorce. Aside from the fact that fair is vague and impossible to pin down, courts just don't spend a lot of time evaluating fairness. Most importantly, what's fair to you is not likely to be considered fair by your spouse, and what your spouse thinks is fair would probably not pass a fairness test for you. It's really more useful and practical to figure out what your needs and goals are and try to meet them. That gives you a more specific target and you will know if you came out well.

Why Does Mediation Work?

Mediation is a settlement process in which two parties meet with a neutral third party (the mediator) to resolve issues in a private meeting or meetings. In Texas, the most common type of mediation is the caucus method which usually consists of one session (sometimes two), with each party having an attorney present and the sides usually in separate rooms. The mediator shuffles back and forth between rooms, conveying offers, questions and suggestions. The parties rarely see each other in the caucus approach. In other states, there may or may not be attorneys involved and the parties usually meet and discuss the issues face-to-face in mediation sessions.

Mediation began to be widely utilized in Texas to help settle litigation in the mid- to late-1980s. Since then, it has become very popular, especially with judges. It has proven effective, reasonably priced and safe for the parties. Nevertheless, I still have clients express doubts and frustration when they are ordered to go to mediation before they can go to final trial. They sincerely believe that there is no hope of settlement, usually because the other party is stubborn, crazy, stupid, angry, unrealistic, etc. I always explain (after mentioning that we have no choice if it is ordered by a court) that I have had a large number of "impossible" cases settle through the use of mediation. Let me briefly explain why mediation works.

1. Mediation brings into a dispute a neutral third party with an objective approach to the case whose purpose is to get an agreement. Whatever the mediator does is seen as an effort to reach an acceptable agreement, not to advance the interests of one party at the expense of the other party. Because of the neutrality, a mediator can make tough suggestions and criticisms which will be heard very differently than they would be if made by the opposing attorney. The mediator can also make statements that a party's attorney should (and may want to) make, but which could undermine the client's faith in his or her attorney's commitment to the client's side. It is a way for a party to receive important information, even if it is not what the party wants to hear.

2. A good mediator can de-personalize the negotiations. Again, the neutrality is helpful. A mediator will usually emphasize the value of reaching an agreement outside of court and will try to shape the sessions into more of a business decision rather than something more personal.

3. The mediator usually helps each party understand the range of options, including the best alternative to a negotiated agreement. Often in a divorce, a party starts out with a set of ideas of what he or she wants and the party is unwilling or unable to conceive of other options or any reasons to consider other options. It is difficult for the attorney for such a party to bring up other options in some cases where the party is emotionally committed to a particular outcome. Because of the neutral role of the mediator, it is possible to explain and explore other options. A mediator can also help a party come up with new ideas by brainstorming with the party.

4. An important factor for the success of mediation is that it carries a sense of finality, a feeling that the end of a nightmare may be in sight. In Texas, mediation usually occurs fairly late in the process and after information is exchanged between the parties in "Discovery". The parties are often really ready to end the litigation. One of the factors that often comes into play is that parties become more willing to compromise if they see the reward of wrapping up the divorce.

5. On a related point, when mediation occurs late in the litigation process, a settlement may be achieved because the parties may be worn down or worn out from fighting and arguing. They may be spent emotionally and so is their money. They just are not up to fighting as much as they were originally. Sometimes, they have already collected their pound of flesh and they are ready to end the divorce.

6. Mediation is usually cheaper than a trial and in many areas is a required step before trial. Stable and reasonable parties (there actually are quite a few in the world) recognize the savings they can make by compromising in mediation instead of going to trial.

7. The mediator can play devil's advocate for both parties and educate each party about possible problems with his/her approach. Creating a little uncertainty, or reality, can make the parties more open to adjusting their demands, positions and solutions. Sometimes, a party hears a contrary view for the first time from the mediator since some attorneys are uncomfortable or unwilling to disagree with their clients. Or a party may have just ignored differing opinions or suggestions.

Mediation creates an opportunity for parties to become educated about a number of things that impact of their willingness and ability to settle a case. Experience shows that amazing results can occur with a skilled mediator, even in the most difficult cases. Every litigant should strongly consider, and even look forward to, getting into mediation so they can get the right result that is acceptable to both parties, work in a less stressful, private setting and save time and money.

7 Roadblocks to Successful Mediation

Mediation is a very popular and widespread process used to resolve disputes, especially in divorce cases. In many places in Texas and probably most other states, mediation is virtually a requirement before a case can go to trial. The reason is obvious -- it works! My observation is that mediated cases settle about 90% of the time, or more.

For mediation to be successful, it takes a good, well-trained mediator. In Texas, we normally have attorneys present and participating with the parties in the mediation; some other states often have the parties attend mediation without attorneys. Both systems obviously can be effective. Success, however, is not guaranteed and should not be taken for granted. Here are seven problems that can prevent a successful outcome from mediation.

1. Lack of preparation by one or both sides. The parties need to have all the information and records at hand so they can make intelligent decisions. It's also very helpful for both parties to have thought through their personal goals, needs and interests so they know what they should try to accomplish in the negotiations.

2. Unrealistic expectations. If one party has goals or ideas that are very unrealistic, agreement would be unlikely. It is normal for the parties to disagree about things, but sometimes there is no way to accomplish what one of the parties wants. An attorney should work with the client to help them reasonably define and describe what they want to end up with. If a party demands 80% of all the assets because the spouse has had an affair or drank too much or abandoned the family, usually the case is very unlikely to settle. As the Rolling Stones said, "You can't always get what you want." The parties need to be realistic and keep in mind the costs of not settling.

3. Lack of commitment by a party. If one party or both don't take the process seriously or don't want to settle, there won't be an agreement. Both parties need to see and feel the advantages to themselves from a settlement. Without commitment, the parties won't stay in the compromise mode long enough to settle. They can easily become discouraged if there is not a quick, painless settlement.

4. Inability of a party to make a decision. I have seen situations where we have waited two hours or more for the other party to respond to a changed settlement proposal that wasn't particularly complex. Some people don't handle stress well and some don't like to make quick decisions. The parties should learn in advance how the mediation process works and how decisions are made. They need to learn to approach the process as if it were an impersonal business deal. Participants should expect to face choices and they need to understand that they probably won't be happy with everything that happens at mediation. Even highly educated people used to making tough decisions affecting others sometimes have hard times making decisions in mediation.

5. Positional bargaining. People who begin negotiations without clearly defining their goals and needs will usually begin by staking out a territory or percentage as a starting point and leave themselves room to compromise. Sometimes, both parties figure out a middle ground for a target and figuratively both take ten paces backward before negotiating. Some people want a percentage of the property, regardless of what their needs are. For example, many husbands will insist on a 50-50 split and some wives will choose a starting point of 70% or 65% of the assets, when it may be that certain assets would be preferable for one party, such as cash in the bank (with no tax consequences) versus funds in a retirement plan (with penalties for early withdrawal plus income taxes for the amount paid). Positional bargaining can make for easier negotiations, but the results may not be very helpful to either party.

6. A mentally ill participant. There are, of course, varying degrees of impairment from mental illnesses. Medication and counseling are often helpful for a patient. Sometimes having a close family member or friend present during the mediation can help the party be in a frame of mind to negotiate effectively. Without extra support and/or meds, a mentally ill party can scuttle the effort to settle.

7. A mediator perceived as biased for one side. Unless both parties have confidence in the quality and neutrality of the mediator, it is unlikely that the mediation will be successful. Some parties don't trust a mediator who is a male or one who is a female. The location of the mediation or the mediator's office may produce distrust by a party. If the mediator is seen as a friend of the other attorney or party, the mediator will probably not be acceptable. Attorneys should make sure that the mediator is someone who will be acceptable to both parties.

There are other potential pitfalls for mediation, but these are some of the major ones. If you are planning to go to mediation, you should work diligently in advance to be prepared, committed and ready to decide. Keep an open mind throughout the process so you have the best chance for success.

7 Tips for Witnesses

To be an effective witness requires preparation and forethought by the prospective witness. Ideally, there should be coordination and discussions with the attorney who is calling the witness. In the best situation, there would also be a rehearsal in a simulated courtroom environment, although that rarely happens in the ordinary case. The following are some basic steps that can be taken to prepare a witness to testify.

1. Review the facts, records or whatever will be testified about. Refresh your memory so that you remember the important facts and are clear about what happened. Sometimes, there is a long time between the event that occurred and when the testimony takes place. Be sure to review all the facts and any records about the event. It's a good idea to record your observations right after an event occurs so that you can review that later to help remember what happened.

2. Talk with the attorney about what to expect. This would include reviewing possible questions, objections and strategies. Have the attorney try to anticipate what will be discussed so you can prepare for it. There is nothing unethical about rehearsing your answers to some questions, but you need to be careful to avoid appearing too rehearsed because that might appear dishonest or not credible. It's nice to not be surprised. You can give a more accurate answer and be more helpful to a judge or jury if you have had time to think about an issue and have a clear memory about it.

3. Always follow the judge's instructions. The judge is in charge and you will not win an argument with him or her. You can hurt your credibility if you don't do something the judge ordered you to do.

4. Be sure to listen to the question before you start to answer. Think about your answer before you start giving it. This isn't a race -- you don't have to hurry an answer. Pause before answering. Be sure you pay attention and hear the whole question, and then answer. If you don't understand the question or didn't hear it clearly, you can ask that the question be clarified or repeated.

5. Pay attention to basic courtroom etiquette.

• Don't argue with the other attorney, and especially not with the judge.
• Don't interrupt the questioner.
• If there's an objection, stop talking and then do whatever the judge tells you to do -- answer the question or don't answer it.
• Just answer the questions. Don't ask a question in response.
• Speak up so everyone can hear you.
• Don't lose your temper. That will hurt your credibility enormously.

6. Don't try to carry the whole load--rely on an attorney. The attorney will have a fresh perspective and be able to look at the big picture. If the attorney does not think that asking you a certain follow-up question will help, the attorney normally will more on to more important things. If you think you got "hurt" by some questioning, it is better to let the attorney decide whether to get back into the issue. The attorney is in a better position to determine what is important and what is not essential. If you get cut off and cannot give a full answer when you are being cross-examined, let your attorney decide on whether to pursue it.

7. Tell the truth! Don't embellish, exaggerate or generalize. Attorneys and judges are usually very literal-minded. Don't guess at the answer if you're not sure. It is OK to say you don't remember something. Just be truthful.

If you follow these simple tips, your experience as a witness will be less stressful, more productive and more effective.

A Higher Calling -- Good Phone Etiquette

An issue that comes up occasionally is how to manage regular phone contact between a parent and a child when the child is with the other parent. Usually, it involves a younger child. Over the years, I have seen many battles over telephone contact. The fights are often proxies for the more direct issues between parents who are vying with each other to claim the relationship with the child. Sometimes, the conflicts will continue for years, with no apparent winner.

Courts have come up with some fairly standard solutions that will sometimes work. If the parents are really dedicated fighters, a court order is usually needed. The order must specify a lot of detail, or the parents will continue to fight over the dates, time, duration, and circumstances of the calls. For example, an order might provide that the non-custodial parent could talk on the phone with the child every Tuesday evening at 7:00 p.m. for 15 minutes. Sometimes, a decision is needed about whether or not it will be take place on a speaker phone.

In trying to decide whether to set up a pre-determined call, parents can easily get into the "what if..." game as a means of avoiding the calls. What if we're not home? What if we're eating dinner? What if they are playing outside with friends? What if Junior is sick? What if Sis has too much homework to talk? What if there are friends or relatives visiting? What if she is at a birthday party? What if he doesn't want to talk to Dad? A creative parent can come up with innumerable obstacles to the phone calls and still try to claim s/he is not opposed to the calls, if these issues can be resolved.

Here are some new tools that are being adopted to avoid some of the silliness and meanness that surfaces in connection with setting up contact between parent and child when the child is with the other parent.

1. Cell Phones. Fortunately, technology has provided many more alternatives to deal with whatever problems can come up. For starters, cell phones have made it possible to have a lot more contact at various times. While not every kid has a cell phone yet, I have it on good authority that every kid 14 or older has one; I know that my son was the last 14-year-old without a cell phone and he has one now. It is easy to make a call to a cell phone and not have to go through the other parent. The phone goes wherever the kid goes, so location and time are not such big factors anymore. Unless the child has very limited minutes available, the length of the conversations is not an issue. With even some 1st and 2nd graders now getting cell phones, and more kids having cell phones each year as they get older, there is a large group of kids who can easily talk with the non-custodial parent.

2. Another option is video conferencing. Like cell phones, more and more families have one or more computers with access to the Internet. With a small, inexpensive camera attached to the computer, it is pretty easy to set up a long-distance conversation with good picture and sound. It's a step up from just a phone call and is really helpful when the parent lives a considerable distance from the child.

3. Texting. OMG, it's something everyone can learn, and kids often seem more comfortable texting than talking. LOL. For adults who aren't familiar with it, and the lingo, you can learn quickly from your children (if you don't mind the condescension). With texting, you're not bound by time, dates or duration, so you can communicate often and casually.

4. Email. Most parents are probably familiar with email and use it often. They are comfortable with the process and have a computer or electronic equipment so they can email. For those without computer or email access at home or at work, there are free computers to use at public libraries and other places.

5. Leave Messages. Although this may be very old fashioned, but it still works. You can call, email or text a message to the child, or you could leave a hand-written note in your child's suitcase, backpack or books.

If you're thinking about utilizing one of these tools, here are some quick thoughts about how to avoid some of the problems that can develop.

• Don't be intrusive. Don't insist that your preferred schedule must be followed if it seriously interferes with what the child or other parent has planned. Be willing to compromise and don't interrupt legitimate activities of the other parent or the children. Kids don't want to be in the middle of a battle between parents over schduling.


• Don't be obsessive. Be flexible. Don't let this issue dominate your relationship with the other parent or child. Recognize that circumstances change and unforeseen events happen all the time. You may miss a call or chance to talk with your child, but there will be more.


• Don't be daily. Let your children breathe. Don't try to talk with them every day, unless there is a special need.


• Don't try to require a speaker phone or listen in on another extension. Unless there is clearly inappropriate behavior by the adult, allow your child and the other parent some privacy.


• Don't participate in your child's conversations with the other parent, unless invited to do so. Parent and child are really wanting to visit with each other, not you. Certainly, don't interject your comments in the conversations between your child and the other parent and don't interrupt them.

A little common sense and courtesy will go a long way to helping your child deal with the difficulties involved in living apart from one parent. Although there may be hard feelings between parents, they shouldn't let them show. Instead, the parents should demonstrate good adult behavior by cooperating and allowing, maybe encouraging, contact between their child and the other parent. Everyone will benefit in the long run.

Divorce "No No's" -- Don't Drag the Kids into the Divorce

A recent newspaper article highlighted some of the problems that can occur when kids are involved in their parents' divorce. That situation, involving famed wrestler/entertainer Hulk Hogan and his wife, is a little extreme, but the same type situations occur with just regular people.

Here's how children are sometimes brought into a divorce. Some may seem innocent, but they usually lead to bad situations. Some are active or direct and others are passive or indirect. They can all lead to emotional and behavioral problems for children.

1. Make a child into a messenger. This can be done a number of ways. A note can be sent through the child. A parent can tell the child in person to tell the other parent something. A parent, in a phone conversation, can ask the child to tell the other parent something. However it is done, there is a good possibility that the child will pick up on each parent's feelings (often anger) toward each other. The words used, the tone of voice and other non-verbal communication cues can be upsetting for a child. The nature of the other parent's response, both verbal and non-verbal, will also affect the child.

2. Let kids "overhear" comments about the other parent. This is a passive way to involve the children and subtly try to win them over to a parent's side. It can be distressful for children.

3. Let kids be present, in person or on the phone, to hear arguments about the kids. Parents can easily set up arguments to occur when the children are around, such as when the children are delivered from one parent to the other. It's hard enough for kids to transition from one household to another without adding more tension from an argument.

4. Make comments directly to the child about the other parent. Many parents are very blatant about making negative comments to a child about the other parent. That's often a sign of immaturity of the parent, but it can be very damaging to a child who may take the comments as an attack on the child since the child is part mom and part dad.

5. Discuss the "facts" of the divorce with the kids. Some parents believe their children are old enough and mature enough to know the "truth" about the parents' divorce. Often, the facts are not totally correct and reflect the natural bias of one parent. This is usually a way to try to win over the child to the parent's side. It took can be damaging to the child who hears a lot of negative comments about the other person who is half responsible for the child -- in effect, half of the child.

6. Inform kids, or let them know, about what they are missing out on because they will be with the other parent. This can be a little subtle. Maybe the parent is just disappointed because the child won't be around to go somewhere or do something with that parent, but it's upsetting to the child and it's unnecessary. It's also a way to try to put the other parent in a bad light because he or she isn't doing something exciting or because he or she won't let the child do something the child wants to do with the other parent.

7. Ask the kids to make choices between parents. This can take place on different scales, from choosing activities to choosing who to talk with to choosing where to live. That is too much responsibility for the child and puts the child in an inherently conflicted position. Those matters should be decided by the parents.

Thanks to Christine Bauer of the Florida Divorce & Family Law Blog for the tip on the story. You can read her comments about it here.

Preparing for Divorce: 7 Tips on Finances

James J. Gross, in his Maryland Divorce Legal Crier, had two excellent recent posts that included 11 tips for men and 11 tips for women to get ready for a divorce. I have used some of his ideas and some of my own to come up with the following 7 tips on finances for someone facing a divorce.

1. Have some funds available. Make sure that you have some cash or credit or money in the bank that you can use as you go through the transition from married to divorced. You will need money to pay bills, hire an attorney and purchase new things as a second household is created.

2. Prepare a budget and cut expenses. You can figure that most of the time there won't be enough money to go around. You need to be careful how you spend your money and make sure you don't waste it. Preparing a budget helps you decide what's important to you and when and how you will spend money. Part of the budget process should include finding ways to cut expenses. Reducing your spending and focusing on the essential needs will help you meet your basic needs.

3. Get control of you credit cards. Make sure you have some credit cards in your name so that you have something to use in an emergency. Make sure, as much as you can, that your spouse is not able to go crazy charging up the credit cards. That is a common strategy, especially if the cards are joint or the other spouse is the person primarily responsible for the cards. It is not really a good idea to take away all your spouse's cash and credit cards, but it will be a lot safer for you if you have control of the cards for which you are primarily liable. Just make sure your spouse has adequate resources to support himself or herself.

4. Plan to spend money for an attorney. At a time when a 35-50 page divorce decree is not unusual, it is a serious mistake to try to represent yourself in a divorce, rather than hire an attorney. If it is a matter of cost, you should check around for attorneys because there is a wide range of costs and payment arrangements; you can probably find an affordable attorney if you keep looking. The potential cost of not hiring an attorney is enormous!

5. Separate bank accounts. If you have joint bank accounts, they should be divided. Taking all the funds is not generally acceptable. You can probably take half the funds, but even that depends on the needs of both parties and what other assets are available. Separating the bank accounts will prevent your spouse draining all you funds and leaving you in the hole. Using restraint will make you look good to the Judge and the other side.

6. Create a list of your assets and liabilities. Getting started early gives you something to do with the nervous energy you have from going through a divorce. It's a good idea to gather records and prepare the list while everything is available and still fresh in mind. In most divorces, both parties are required to prepare sworn inventories. These are lists, in a standardized format, that include all the assets and liabilities of the parties. They become the basis for negotiation or a summary that often is introduced into evidence at trial (if there is a trial).

7. Keep your insurance in place. Remember why you have insurance. You need it for medical care and for your vehicles and home. Keeping the insurance will help save money on medical treatment, medicine and other related services. Keeping what you have at the outset will help avoid the accumulation of unpaid medical bills or repair bills that can occur if your insurance is canceled or lapses. Usually, the cost of maintaining the policy is not too great, especially when compared to cost of uncovered medical and other services. The insurance will have to be split up eventually, but it can be done later when both parties have time to sort things out.

If you are possibly facing a divorce, you should follow through with the actions outlined above to protect the family finances. Good luck!

Can My Spouse Take My Retirement?

In a recent post, in the Preventive Family Law for Nevada blog, Allison Herr wrote about a common question among parties going through divorce. The issue comes up in several variations. What happens to retirement funds? Can my spouse get my retirement? Will I have to withdraw funds from my retirement to pay my spouse? Will I lose retirement funds that I earned before marriage?

The questions arise in a variety of circumstances. A spouse may have earned some or all of a retirement account prior to the current marriage. One spouse may just not have much retirement to divide. Sometimes, one of the spouses has no retirement. Often, a person considers his or her retirement plan as personal resource which should not be divided because that person alone earned the benefits at that job. Even where both spouses have created retirement accounts, it is common for each party to want to keep all of his or her own account.

The starting point to remember is that under Texas law, virtually all retirement funds earned during a marriage are community property and are subject to division upon divorce. Retirement funds earned prior to marriage are not community property and a court cannot divide them unless both parties agree. Usually, spouses will work out an agreement on how to divide all the assets, including retirement accounts. Courts and attorneys usually try not to complicate matters by dividing every asset. Instead, they usually will divide the community assets by awarding complete assets to one party or the other and "equalizing" the division at the end.

It is a good idea to not become too emotionally attached to your retirement account. Such emotional attachment is not rational and puts you at a disadvantage in negotiating a settlement. If your spouse detects your feelings, he or she may manipulate you by threatening to take the retirement so that they can end up with something more valuable that they really want. In addition, the account is just an asset and a court really could award all or part of the community portion to your spouse. There's no reason to get upset over that unless the account has some special value or you expect a big increase in value in the future.

It is not necessary for a court to order a party to withdraw funds from the retirement account and pay them to the other spouse. A special court order, the qualified domestic relations order, can split an account without causing tax consequences or penalties.

The best way to approach the retirement accounts is to plan ahead and figure what your needs and goals are about retirement. Will you have sufficient assets to support you through retirement? Do you have separate assets? Are you realistically expecting an inheritance? Can you project a budget for your needs and living expenses? What amount of money now will it take to support you in the future? Do you want risky, but very profitable investments in your retirement account, or do you want a conservative approach that is safer, but less likely to grow significantly? It would actually be a good investment for you to get expert advice from a financial professional who is not trying to sell you a product. You can ask your attorney for a referral to help you find someone to help you plan. With careful thought and planning, you can protect your future, with or without a specific retirement account.