Some potential clients often say they want their own financial professional to protect them and let them know all the assets and income the family has. This client is usually the one who has some other responsibility in the family structure and left the finances to their spouse.
Other potential clients say they do not need a financial professional as they already know all there is to know about their finances.
What I say to the first noted potential clients is that I, as a neutral financial professional, promise them they will know everything financially related to their divorce prior to any decision making. It is my job to lay out all the assets and debts and income and expenses in simple and understandable form to both clients and any mediator or attorneys. It is also my job to educate my clients about taxes, tax filing status, health and life insurance, Social Security, pension values, and the consequences of dividing assets that have tax related issues.
What I say to their spouse is that by having a neutral financial professional, they can relax that what they know to be true will be corroborated by my work product.
Including one licensed neutral financial professional can speed the process from information gathering to negotiation.
Here is how a neutral financial professional protects both of your financial interests:
- Prepares the comprehensive legal, financial disclosures with all supporting documentation.
- May meet with each client separately to ascertain needs and goals and if needed, to develop a future workable budget.
- Prepares complete, concise financial reports for everyone’s use to review for completeness and to use as a resource during negotiations.
- Provides cost savings and efficiency over preparation by each attorney or separate potentially conflicting financial professionals.
- Educates one or both clients regarding their current financial situation to enable each client to negotiate with their spouse with the aid of their attorney.
- Addresses the financial arrangements necessary to support healthy children.
- Facilitates discussion of settlement options including division of assets and debts, child and spousal support, tax filing status, college expenses, and related tax consequences.
- Helps to alleviate power imbalances in the room by the very nature of being neutral.
- Brings to the other professionals’ attention a client who may not be able to speak up in a meeting due to trepidation, guilt, perceived or real lack of knowledge, or concerns for spouse’s feelings.
- Addresses a client’s concerns about hidden assets.
- Provides protection for the spouse who has handled the majority of the family finances or has the majority of the knowledge of the family finances.
- Brings the voice of financial reality to the discussions – this is a big one.
- Reviews marital settlement agreement for accuracy as it relates to financial and tax discussions.
Judith F. Sterling, CDFA, CPA is a divorce financial professional practicing in San Francisco, Marin, Mendocino, Napa, and Sonoma Counties. More information in her bio on the “Find A Professional” page.