CDFA™ is the only
comprehensive divorce planning designation listed by
the CFP®-Board and its listing of professional certification
Will I be able to receive alimony?
tests for alimony (or maintenance or spousal support)
include some of the following, however, keep in mind
that no two cases are the same. You need to seek individual
advice in order to determine how the specifics of your
case may impact your ability to receive alimony: · Need
- Can you support yourself with earned income plus investment
income? · Ability to pay - Does the payer of alimony
have sufficient funds to pay? · Length of marriage -
A long-term marriage (10 years or more) is typically
a stronger case for the lower-earning spouse. · Health
of both parties.
Will I lose my pension?
Pensions and retirement plans are marital
assets. Depending on the state you live in, the portion
that was earned before your marriage could also be considered
a marital asset. However, it is possible to keep your
pension and have it offset with other assets.
Should the custodial parent keep the house?
This is a great question, because it's
one of the most important overlooked questions. The
answer is sometimes yes, sometimes no. It's important
to pinpoint exactly what it will cost to maintain the
home, factoring in taxes and inflation. The next step
is to analyze if there is enough money coming in to
stay comfortable in the home (in other words, pay the
bills each month). Once that has been determined, the
advisability of retaining the home must be compared
to the advisability of giving up other assets (such
as liquid accounts, retirement plans, etc.). Finally,
all decisions need to be weighed against current economic
and stock market conditions. Certified Divorce Financial
Analysts™ are trained to help people answer this question
before they commit to a settlement that cannot be changed.
What if I bring a house into the marriage that is in
my name only, and I add my spouse's name to the deed?
In this case, the whole house could be considered marital
property. You might have made a "presumptive gift"
to the marriage and should consult with a family law
attorney to discuss your options.
Is my IRA considered marital property? It's in my name
Everything acquired during the marriage, no matter whose
name it's in, is typically considered marital property.
In some states, the increase in value of separate property
could also be considered marital. If you are going through
a divorce, it would important to evaluate the financial
drawbacks to having your IRA included in the list of
assets you retain, post divorce. Remember, the funds
in the IRA cannot be accessed before 59 1/2 without
paying a 10% penalty for early withdrawal.
I have never worked. Can I get Social Security?
If your spouse has worked
and if you have been married for 10 years or more, than
you are entitled to one-half of your spouse's Social
Security or your own, whichever is higher--even if you
are divorced. Your spouse still retains 100% of his/her
Social Security benefit. This is an automatic guarantee
and therefore it is not a negotiation point in a divorce.
How do we figure how much child support should be paid?
Every state has Child
Support Guidelines that are mandated by the State. However,
the Guidelines get tricky when one (or both) spouses
is an independent business owner who can control their
wages. In this situation, it typically helps to bring
in a financial or tax expert who can help determine
the true potential income of the partie(s).
Do we have to go to court?
Only if you can't reach
an agreement. Then, a court date is set and a judge
hears the case. Less than 2% of all divorce cases go
to trial in the United States.
What is a QDRO and why do I need one?
A QDRO (or Qualified
Domestic Relations Order) is the legal document that
divides up a qualified pension or retirement account
(including 401k's) pursuant to a divorce. The Judgment
of Divorce is not sufficient to divide up qualified
plans, a QDRO is needed. There are many nuances that
go into QDRO's and make it an advocating (versus neutral)
document. In order to protect your assets, be sure to
obtain qualified advice in this area from a specialist.
* Disclaimer: CFP® Board does not endorse or otherwise
approve any specific certification programs and CFP®
Board's listing of any certification program does not
constitute an endorsement or approval of that program.