Articles Posted in Economics and Divorce

The Artisans of the Collaborative Divorce Process: The Financial Neutral | Divorce Attorney Andrea Vacca | Vacca Family Law Group

Part 1 of a 2-Part Series

I recently heard the analogy, “Attorneys in a Collaborative Divorce are like the general contractors.” The lawyers know the law and what issues and problems need to be solved, but they do not have the level of financial expertise, nor the level of emotional expertise, that the couple will need to solve those problems. This is the reason why we bring in specialists and experts – the artisans – to help deal with the many details of the new family structure/entity that the Collaborative Divorce team is helping the clients to build. The lawyers have the responsibility to learn what the clients need so that they can bring the right craftspeople to the project. In this blog, I will discuss the expertise that the Neutral Financial Professional brings to the collaborative process. In my next blog, I will discuss the expertise that the Family Specialist brings.

I want a divorce financial professional on all of my divorce teams so that I can make sure the family’s post-divorce financial foundation is properly built and will be able to sufficiently provide for the couple and their family for both their short-term and long-term future.

In this Wealth Matters Column in the New York Times, I talked about options that are available to couples who want to divorce while the courts are closed or backlogged during the coronavirus pandemic. The columnist, Paul Sullivan, was particularly interested in what options were available if people were negotiating child and spousal support agreements during this time when their financial situation may be precarious.

This was a great question because many couples may know that their marriage is over but they don’t know how they can divorce if there are economic uncertainties. My best advice to these couples is to do everything you can to stay out of court so that you can negotiate an agreement that is flexible enough to address financial changes in the future. For example:

1. If you are not working now, we can draft the child support or spousal agreement to state what will happen if you return to work in the future.

Divorce in New York can be expensive and this is especially true if there are complicated issues involved regarding finances or your children. But there are things you can do to keep the costs down.

I recently contributed to a Forbes Next Avenue article 8 Ways to Lower the Cost of a Divorce. The article makes it clear that with planning and some DIY homework, you can lower the attorney fees for your divorce.

In addition to the 8 tips in the article, I would add these as well:

Baby Boomer divorce rates continue to be above the average with one in every four divorces occurring in this age group. When I first wrote about so-called “grey divorce” (also referred to as ‘gray divorce’) in 2012, the overall divorce rate was going down, while the rate of divorce for people born between 1946 and 1964 already had a divorce rate triple that of their parents.

In 2019, those statistics are holding true. Grey divorce is a divorce that occurs after the age of 50. While the divorce rate across all age groups holds steady, the number of 50+ aged grey divorces in the United States has recently dramatically increased and today 1 in 4 people are going through grey divorce.

Grey divorce expert Jocelyn Elise Crowley states,

Dissolving a marriage or partnership is never easy: divorce and mediation are never stress-free. Many factors need to be considered, decisions need to be made and plans need to be mutually agreed upon. Your divorce lawyer is an integral part of ending your marriage, but there is a lot you can do on your own to plan for your divorce and make decisions about the future of your family.

Books, articles and support groups provide information, resources and assistance in helping you manage your divorce and consider issues that you aren’t yet aware of, or need more information on. There are many good resources available by parenting experts, therapists and psychologists, financial planners, and divorce and mediation lawyers that can help you navigate your own divorce.

Note: Vacca Family Law Group receives no affiliate or referral fees;

I recently presented a workshop entitled “Collaborating in the Face of Financial Betrayal” at the International Academy of Collaborative Professionals 18th Annual Networking and Educational Forum, alongside my colleagues, Certified Divorce Financial Analyst, Ivy Menchel and Divorce Coach, Abby Rosmarin.

While this workshop was geared to the divorce professionals in the room, there are many lessons that anyone who has dealt with financial betrayal in his or her own marriage — and is contemplating divorce — should understand.

To start, we defined financial betrayal as the keeping of financial secrets in an intimate relationship. Financial secrets are different from other secrets because of the enormous ramifications that often result from them for many years to come.

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When a couple divorces, it is usually the case that neither party gets everything he or she wants. Understanding and accepting this fact before you start the divorce process can help make the process less costly – both financially and emotionally.

One of the many things I have learned from my family law clients over the past 20+ years is that when they strive for an outcome (whether via agreement or court order) that provides them with everything they want, they are inevitably disappointed. Perfection is not achievable in life and it’s certainly not achievable in divorce. Instead, I encourage my clients to think about what a “good enough” outcome would look like.

For example, if we’re talking about spousal support – How much money per month do you really need or can you afford to pay? What are the most realistic options that are available to you now that there will be two households instead of one? Many times sketching the financial picture makes people cringe – especially if they’re being told things that they don’t want to hear, such as “You have too much debt,” or “You’re going to have to return to work.” But sometimes there is no way around these facts. It’s better to accept reality and work within those parameters, rather than to strive for an outcome that may look perfect to you but will leave your soon-to-be ex (and perhaps the children) suffering terribly.

It is possible to make the divorce process more time- and cost-effective?

When potential clients consult with me in connection with their divorce, one of the first questions they ask is, “How much do you expect this to cost?” and one of the second questions is, “How long do you expect this to take?” Time and money are, understandably, major concerns of anyone entering the divorce process, so I know that these clients want to hear answers that reflect a best case scenario. I can never predict the exact end date or the costs involved, but I can tell these clients that the more of these tips they follow, the more likely their divorce process will run smoother and be more cost-efficient:

1. Make sure your spouse knows that you want to end the marriage. It’s understood that asking a spouse for a divorce can be difficult, emotional and frightening, but try to find a way to broach the subject before you retain an attorney. Perhaps you can engage a therapist, marriage counselor or trusted friend to help you have this conversation. One of the least productive ways to start the conversation is to have an attorney send a letter to your spouse announcing your intention to divorce him or her. Remember, your spouse will have to first get over the emotional shock before any productive discussions can take place.

Lately, women are being encouraged to “Lean In”, which is the title of Sheryl Sandberg’s book that encourages women to take an active role in their career development. So I found it very interesting to read an article in the New York Times Magazine titled “The Opt-out Generation Wants Back In“. It not only spoke to me because of how confusing all of these messages can be for women, but also because as an attorney and mediator who works with divorcing couples, I’ve seen the fall-out when women who opt-out of viable careers to devote themselves to their families end up divorced.

The story, written by Judith Warner, is part longitudinal study and part confessional, covering the lives of three women over ten years who decided to “opt out” of the working world to take care of their children. With husbands who brought home mid-six figure salaries, it seemed to them like the ideal opportunity to step off the career track and choose instead to be home with their children.

But for the women in the article, betting on “perfect” did not pay off. For example: