28 Mar Your Housing Options after Divorce Just improved

Major banks in Canada recently announced a reduction to their fixed rate mortgages. It seems bank executives are more confident about the housing market and the likelihood of a major correction in housing prices.

This should provide good news for people who are separating and making decisions of how they split their assets, in particular, the matrimonial home. For many, keeping the house is important for couples with children and keeping a stable environment for them. For older couples, whether they choose to buy a partner out and remain in the matrimonial home or sell and each purchase a new home, lower interest rates allow for more flexibility when it comes to possible settlement options.

Managing two households costs more than maintaining one household. With late in life divorce, retirement plans are greatly affected by housing costs.

Many people finance equalization payments owing to spouses through refinancing existing mortgages, so lower mortgage rates in those situation helps.

If selling the matrimonial home is part of a settlement plan, lower mortgage rates make home buying more attractive. If keeping the matrimonial home is an option, managing cash flow is easier with lower monthly mortgage payments.

The home you want to keep or the home you want to buy after divorce may
now be a real possibility.

20 Nov Exciting News about “Grey Divorce” book

Announcing  the upcoming  publication of our book  “  When Harry Left Sally – Finding your way through Grey Divorce” .   It will be available in a couple of weeks.  I’ll keep you updated to let you know when it will be available to order from online retailers and dedicated website for “When Harry Left Sally”.

Co-authored by Marion Korn, a well known senior family lawyer and mediator, and Eva Sachs, a skilled Financial Planner, specializing in divorce, the book shines a light on the growing numbers of grey divorcees and their unique concerns and goals.  Through stories collected in their years of practice together, Marion and Eva challenge the reader to change the way they approach their divorce. This book is the roadmap every divorcing grey couple needs.

Here’s a preview look!

Finding your way through Grey Divorce

17 Sep Divorce Costs

According to a recent AVVO divorce study, couples are most concerned about the costs of divorce.  People today have more choice in how they will proceed with their divorce..from  doing it themselves , mediation, collaborative practice,  lawyer negotiations to court.  The survey  indicated that a majority of people  (58%)  site the cost of divorce as a major factor/concern  in moving forward with the divorce.  When reviewing what approach may work best for  a family, making the right choice in terms of professional fit , control, timing are all  things that need to be considered. However, the reality of the total  expense for the family appears  to be a big  part of the decision.

It’s important to establish from the beginning some sort of “divorce budget”and understanding the value proposition of any process  you ultimately choose.  Being quoted the hourly rate or first retainer  is not enough information. Getting the answer .. “it depends” to the question “How much will this cost”  may not be good enough anymore.  Understanding that other professionals are part of a divorce team and learning  what they all do in the process, what they charge, what their involvement may be , and  what couples can do on their own, helps  in understanding what the  ultimate  costs may be .

divorceinforgraphic_july20132

11 Mar Divorce Costs Followup

As a followup to my previous blog today take a look at this article from the  BBC and UK about the rising costs of divorce.    It quotes a report by the Legal Ombudsman for England and Wales showed complaints by clients in divorce and family law were higher than in any other category.

http://www.bbc.co.uk/news/uk-21611496

Have you gone through divorce recently? What do  you think of the costs involved?   At the end of it all, did you get value for what you paid for?

11 Mar Even billionaires are concerned about the “costs” of divorce

Billionaire T. Boone Pickens was recently divorced from his 4th wife and chose collaborative practice to settle his divorce.

For the whole story, go to http://www.bizjournals.com/dallas/blog/2013/03/t-boone-pickens-on-how-to-save.html?ana=e_abd&u=rk2Eh9uif4Sgj7UM9KhZGpj2jD7&goback=%2Egde_2936590_member_219548098

“The collaborative approach saves both money and emotional wear and tear on families.” Pickens said.

Should non billionaire couples consider the costs of divorce before choosing how they divorce?  Couples should do their research about different processes and the costs of each process.

Creating a  separation agreement with the help of a mediator means you share the cost of one mediator.   If you are choosing the collaborative law approach, you are each working with your own lawyers however,  much of the work can be taken on with the help of  other collaborative team members.

If you have a family professional, rather than your own lawyers,  they help to create and draft a parenting plan.  This is  a shared cost (usually at a lower hourly rate than lawyers).  If you use the assistance of a divorce financial professional, like a Certified Divorce Financial Analyst (also usually at a lower hourly rate than lawyers) to help with gathering the financial information, you’re sharing that cost (and the work too as there is usually one spouse that has handled all the family finances and is better at accessing all the financial statements and documents).

Billionaires become billionaires not only because they make millions… they also recognize when they have the opportunity to save a million or two.

11 Jan Retiring and Divorcing at the same time?

Thought your retirement would be like this?

Thought your retirement would be like this?

But instead it turned out more like this?

But instead it turned out more like this?

The baby-boom generation is showing that it ‘s never too late to consider divorce.  As our life span extends,  people in their fifties and sixties with better health expectations figure they have a number of good years left. Why not live them to the fullest?  That may mean ending their long term marriage and going it alone.

The problem with getting divorced late in life, is that most people find it hard enough to save for retirement and don’t imagine living off of just half of their savings, whatever they may be.

If a couple had money in the marriage, there may be enough  money to go around after divorce.  The challenge is for normal middle-class couples who just scraped by.  Or those couples who lived beyond their means.  When they try to make their house and retirement assets cover two households instead of one, there’s simply not enough to go around.  And they’re not likely to go back to work.  They may be expecting to do the things they never allowed themselves to do while they were married like join a club, travel etc.

When people are relying on a pension or savings, there’s never going to be enough to duplicate the marital lifestyle.  If you’re divorcing at  55 or 60, it may be too late to go back to work or  too late to recover financially.

If you didn’t consider that divorce would be par t of your  retirement plan,  you may want to  work with a divorce team that consists of  both legal and financial professionals. They are there to help you navigate this difficult time, both in a legal and financial capacity.

Image courtesy of Ambro at FreeDigitalPhotos.net <http://www.freedigitalphotos.net

15 Nov Financial Literacy Month Quiz!

 

November is Financial Literacy month  in Canada,  http://www.financialliteracymonth.ca/ 

We experience dealing with money at an early age.  From getting money from the tooth fairy, saving coins in our piggy bank and opening our first bank account with allowance or birthday money.  We also learn how to spend money quickly.  Because we have experience with money throughout our daily lives, it doesn’t mean that we have  acquired the knowledge and skills to make responsible financial decisions.  After all, money doesn’t come with instructions.

When facing divorce, it’s crucial to acknowledge what level of financial literacy you have.  Take this simple quiz to assess your financial health:

http://www.womenindivorce.ca/womenfacingdivorce/tools/checkingmyfinancialhealth.html

 

Image courtesy of vichie81 at FreeDigitalPhotos.net

15 Oct Divorce Settlement Options

When it comes to the financial aspects of divorce, it not just lack of understanding of the family’s finances, it’s the lack of information about a family’s financial picture that tends to make good financial decisions challenging  for couples when they decide to divorce.

One spouse may  know more because they managed the family investments or were in charge of paying the bills.  After all, the couple may have thought it would be a waste of time for both to balance the check book twice every month so one takes the responsibility and tends to keep doing it throughout the marriage.

Important decisions to be made when negotiating your settlement need high quality information from which to judge the options. The spouse with less knowledge may spend more time collecting documents,  working on past and go forward budgets. This is the most important part of divorce financial planning.   Decisions regarding finances are based on choosing one option relative to another. If you are confronted with a decision you must make based on limited information you risk  reaching a poor conclusion that may  affect you for a long time.   That’s why divorce financial planning before, during and after is critical to  your future when dealing with separation and divorce.

 

Image courtesy of Keerati at FreeDigitalPhotos.net

12 Sep Do I have to keep saying no to my kids?

 

One of my clients described how her son was afraid to tell her that he’d outgrown his running shoes. Another said her daughter declined invitations to go to the movies with her friends because she didn’t want to have to ask for movie money. Kids understand the financial changes that occur after divorce.

How can you make ends meet and maintain your family’s lifestyle if your income after divorce is insufficient?

Child support payments are not intended to cover all costs associated with raising a child, and often fall far short. They take into account the cost of food, housing, and clothing. But they do not cover a range of other expenses from after school activities like music lessons or sport lessons to vacations, or cell phones to school supplies. These expenses rise significantly as children get older. Does everyone under the age of 18 really have an I-Phone?

The first thing to do, whether you’re contemplating divorce or are in the process of divorcing, is quantify how much your lifestyle truly costs. As a divorce financial professional, I help clients put together projected budgets. It’s important to account for as many details as possible:  the cost of summer camp, rep hockey, tutoring, a computer the child will need for school in later years.

Then we weigh these financial needs against a couple’s ability to pay. Does the family income cover this budget plus a reasonable amount for the non-custodial parent?  If not, can a division of marital assets help supplement the difference? Can we scale back to a bare-bones budget? Can we distinguish between wants and needs?

In divorce, financial support comes from 4 sources: Employment Income, Child support, Division of marital assets, spousal support. Each of these sources has different tax and financial consequences.  Yet because household spending on adults and children is intertwined, all three can contribute to a child’s financial welfare.

I work with clients to look at the financial and tax implications of proposed child support and spousal support payments along with the proposed division of marital assets.  I use software to project the short and long-term impact of a proposed divorce settlement. These projections can be really powerful.

 

What if you’re already divorced and find that you can’t make ends meet,  a financial planner specializing in divorce can work with you to put together a saving and spending plan and help give you a holistic picture of your finances.

Wouldn’t it be nice to say “yes” to your kids once again?

 

Image courtesy of FreeDigitalPhotos.net

04 Jul Boomer Divorce — Divorce Talks July 17th 2012

 

At 50 or 60, the kids may have left and  couples realize they have 30 or more years left to fully engage with, and enjoy life. If they can’t find a way to do it together, they are considering  taking the risk  of leaving the marriage.  If you or someone you know is part of this growing segment  of the “grey divorce” demographic, join us for this session.

Here are some of the  questions  we’ll be discussing :

  •     What are the factors and pressures that are changing the futures of so many?
  •     Do you worry about how dividing your wealth will affect your retirement?
  •     Do you struggle with the question will leaving be worth it?
  •     How can you access what is right for you in a professional confidential manner?
  •     Where do you go to weigh your options and decide?
  •     And should you decide to leave, how do you do it in a cost conscious way?

DATE: Tuesday July 17th, 2012

TIME: 6:30 to 8:00 PM

LOCATION: 79 Shuter St. Suite 200 Toronto

To Register go to: http://www.eventbrite.com/event/3795921704