(303) 468-5626
10789 Bradford Road, Suite 205, Littleton, CO 80127

Social Security is one of the three major sources of retirement income alongside retirement and savings accounts. While retirement and savings accounts are subject to stops and starts and market volatility, social security benefits are steady and reliable. Thus, it’s no surprise many older Americans are especially dependent on their Social Security benefits. 

According to a 2015 survey by the Social Security Administration, about half of the population aged 65 or older live in households that receive at least 50 percent of their income from Social Security and roughly 25 percent of those eligible for Social Security rely on it for at least 90 percent of their income.

How does divorce affect your social security payments?

How does the death of an ex-spouse change the amount you receive?

How does remarriage adjust the amount of your social security check?

Knowledge is power and understanding each scenario helps you plan your post-divorce future. 

The following information is based on a presumption of one party in the marriage having earned less income throughout their working life than their spouse. If this is not the case and both spouses earned a roughly equal amount throughout their working lives, the following information is inapplicable. Remember, regardless of what you are entitled to based on the amount your ex-spouse earned, you still have your own social security benefit to draw from. 

How Does Divorce Affect Your Social Security Payments? 

If a couple was married for 10 years or longer and they divorce, the spouse who earned less is entitled to the greater of half of the amount of the higher earning spouse's Social Security benefit or 100% of their own benefit provided certain provisions are met:  

  1. the higher earning spouse is eligible for Social Security benefits (Note: eligibility and not application for Social Security benefits is the important distinction)
  1. The couple was married for 10 years before the divorce became final,
  2. the lower earning spouse is not re-married,
  3. the lower earning spouse is age 62 or older and,
  4. the lower earning spouse is not entitled to a social security benefit that equals or exceeds one-half the higher earning spouse’s benefit.

So, if the higher earning spouse is set to receive $2,500 a month in social security upon retirement, the lower earning spouse will receive a payment of half that amount and the higher earning spouse’s amount is not affected. 

Higher earning spouse $2,500/month

Lower earning ex spouse $1,250/month

If My Ex-Spouse or I Remarry, What Happens to Social Security Payments? 

Q: What if the higher earning spouse remarries?

A: If they are married to their second spouse for 10 years and they end up getting divorced, their second ex also receives a monthly benefit equal to half.  

The second marriage will have no effect on what the first ex spouse receives.The only time this will not be the case is if the higher earning spouse was to divorce a fifth spouse as the benefit stops with ex-spouse #4. 

Considering the 10 year marriage requirement for each marriage, it would be very unusual to ever have this scenario take place.

Higher earning spouse $2,500

Lower earning ex spouse #1 $1,250

Lower earning ex spouse #2 $1,250

Q: What if the lower earning spouse remarries? 

A: If the lower earning spouse is married and retires, they would look to their current spouse’s amount to calculate theirs. But if they have been married to spouse #2 for 10 years and they divorce,they are entitled an amount calculated as either: half of the first ex spouse’s benefit OR half of ex spouse #2’s benefits or their own, whichever is higher.  

Assume the lower earning spouse, who has not yet retired, starts to earn more money. In doing so, at retirement, they will be entitled to receive $1,350 a month from their own Social Security account.  When they retire, they choose between taking $1,350 from her own account, an amount based on half of spouse number #1’s account,  or half of spouse #2’s account. They may only choose one and will of course choose the highest amount. 

If My Ex-Spouse Dies, How Does This Change the Amount I Receive? 

What happens after the higher earning ex-spouse dies?

The lower earning ex spouse is entitled to widow/widower benefits if:

  1. the deceased was entitled to Social Security benefits,
  2. they were married for 10 years before the divorce became final,
  3. the surviving ex spouse is age 60 or over, or is between ages 50 and  60 and disabled,
  4. the surviving spouse is not married, and
  5. The surviving spouse is not entitled to a retirement benefit equal to or greater than the deceased’s benefit.

If a higher earning spouse leaves behind a second spouse, this survivor also gets the same if they meet the above five requirements.

A widow/widower’s remarriage after age 60 will not prevent them from being entitled to payments based on the deceased’s higher earnings.  

A widow/widower’s remarriage before age 60 will prevent entitlement unless the subsequent marriage ends, whether by death, divorce, or annulment.  If the subsequent marriage ends, the widow/widower may become entitled or re-entitled to benefits on the prior deceased spouse’s earnings beginning with the month the subsequent marriage ends.

Example: Assume Kathy’s first husband died.  At age 58, she met a wonderful widower, James, and wanted to get remarried but she realized that she would lose her entitlement to all of the deceased spouse’s Social Security benefits when she turned age 60. This may explain why Kathy and James may decide to not get married. 

Now that we understand what happens to social security payments after divorce, remarriage and death, we’re better prepared for our post-divorce future. Having a full picture allows us to ease some of the anxiety brought on by divorce, especially in our more “experienced” years. 

If you have questions about social security, retirement and understanding your financial future post-divorce, give us a call at 303 468-5626. Understanding your circumstances is the best way for a divorce mediator to show you your options and work with you and your soon to be ex on resolutions you both can agree to. 

Recently, a very popular feature of the New York Times, Modern Love, featured an essay written by one half of a formerly married couple who share custody of their 8 year old and live under the same roof, albeit in different living quarters. There are various reasons why divorcing couples might consider co-habitation after divorce, but it does present some legal and emotional hurdles to clear. 

Consider the scenario if the couple has children requiring one spouse to pay child support to the other parent or if the court ordered that an ex-spouse pay alimony to the other ex-spouse. 

If theere's co-habitation after divorce, the support obligation may be altered to reflect the fact that the person paying the support or alimony is living with the recipient and reducing their expenses.

There are many pitfalls to consider when contemplating a post-divorce living arrangement involving sharing the family home once divorced.  That is why it is crucial to engage a CDFA-Certified Divorce Financial Analyst in your case. You will need someone who understands the potential tax and financial issues that can arise.

If you have children that you will be co-parenting, obviously it is not prudent to expose them to conflicts and fights that can occur over finances and/or the parenting plan.

Questions to Consider if You Plan to Live Together Post Divorce

 

 

 

 

 

 

 

 

 

 

 

 

So You Think Co-Habitation After Divorce Will Work For You and Your Ex

Perhaps you and your spouse feel this would be a workable living arrangement, and it may well be for your family--it just requires the proper planning involving the right expert up front.

We provide consultations to divorcing spouses about unique living situations like these. To flesh out your questions about cohabitation, schedule a 20 minute call with one of our experienced divorce professionals.

The decision to stay in the marital home during the divorce process is not one to make lightly. Before changes to the tax law in 1997, divorcees could face a hefty capital gains tax following the sale of family home. Thankfully, tax law has changed. 

However, the capital gains tax exemption of up to $250,000 for a single person and $500,000 for a couple, does come with some caveats. In this blog we discuss these conditions and what divorcing couples need to know about the sale of marital home. 

Although Colorado taxes capital gains at 4.63%, our smoking hot real estate market may still mean you’ll owe capital gains tax if you don’t qualify for the exemption. 

For instance, let’s say you bought a home in the Denver metro area in 2011. Back in June 2011, the median home value dropped as low as $232,000. In November 2021, the month for which the most recent info is available, this amount jumped to $538,000. So in this case, the sale generated a profit of $306,000. In order to be exempt from paying capital gains on anything over $250,000, three conditions must be met. 

  1. You owned the home for a total of at least two years in the five-year period before the sale.
  2. You used the home as your primary residence for a total of at least two years in that same five-year period.
  3. You haven't excluded the gain from another home sale in the two-year period before the sale.

Note: A primary or principal home is a home where you've lived for at least two of the five years prior to the sale.

The first condition for a spouse to meet concerns what the IRS refer to as the “ownership period”

If one spouse, pursuant to a divorce decree or separation agreement is required to grant the other spouse the right to temporary possession of the home, but retains title to the home, and the home is later sold, the spouse that left will be treated as having owned the home for the period of time that the occupying spouse owned the home as principal residence. The one who left gets to assume the ownership period of the spouse who remains. 

The second condition is the “use period”

To qualify for the home sale capital gains tax exemption, you need to show you “used” or lived in the home as their principal residence for two out of the past five years.  The IRS actually looks at the two out of the past five years as 24 months out of the past 60 months. And they don’t need to be 24 continuous months, just 24 cumulative months.

Keep in mind that both soon to be ex spouses must be owners during sale of marital home to take the $250,000 exclusion.

The third condition is the “two year rule”

This means that if you sell after owning for less than two years, you’ll need to pay capital gains tax on any profit. The exemption only can apply after you’ve reached two years of ownership.

Our recommendation when one spouse moves out of the home is to get it in writing that you have an agreement for one spouse to remain in the home but that the spouse who left remains a co-owner. Make sure to include that this is pursuant to a divorce mediation or court order. 

Another important thing to note is to spell out how proceeds of the sale of marital home will be split. The tax liability does not necessarily go hand in hand with the way that the proceeds are split pursuant to the divorce decree.  So, for example, if John owns half the house and Mary owns half the house then each of them are responsible to pay taxes on their half of the house and if, under the property settlement, Mary was entitled to get all of the proceeds, or perhaps 75% of the proceeds, those are two separate things.

If one or both of you lived in a nursing home, the use requirement may be lessened to one year and if you claimed a home office exemption, this amount must be deducted from the $250,000 exemption. To fully understand all the conditions, exceptions and what you need to memorialize in writing, we suggest working with a financial professional. Each of our mediators at the Divorce Resource Centre of Colorado is a Certified Divorce Financial Analyst. We welcome your questions about the sale of the marital home in a complimentary 20 minute call with one of our experienced staff. 

What will your post divorce life look like? 

When you’ve made a lifetime commitment of marriage, facing a divorce brings up all kinds of uncertainties and accompanying questions.

Questions like: 

At the Divorce Resource Centre we take a process oriented approach to these questions DURING the divorce mediation process. Whether you come to us first, or after you’ve worked with an attorney, we take you through our process so you have a system you can rely on. Goals get all the attention when developing a process and creating a system are much more important. 

This is true especially when you’re planning what the rest of your life will look like. James Clear, author of Atomic Habits said it best, “The purpose of setting goals is to win the game. The purpose of building systems is to continue playing the game. Systems are the processes that lead to those results.”  

Divorce mediation is not about winning the game, it’s about finding a long term peaceful resolution. So do you have a system and a process to get there? The Divorce Resource Centre of Colorado has a six part process to arrive at a peaceful resolution. Below we discuss each step in our unique process in more detail.  

#1 Understand Your Finances to Deal with Divorce

The first step is gaining clarity about your financial situation. We focus on your current and future financial situation, your goals and guiding principles. The financial needs of the children are also part of this process. In this step, we offer initial observations and possibilities for the outcome of your case, all while taking the time to ensure that you understand each part of the mediation roadmap. 

#2 Get Your Soon to be Ex-Spouse on the Same Page

DRCC’s next step is working to make sure you and your soon to be ex spouse are on the same page. We ask the right questions to uncover your thoughts about dividing one household into two, financially and where both parents stand on various parenting issues. You’ll gather your thoughts using straightforward worksheets and have a chance to express your point of view on any issues of concern so that we can properly facilitate your discussions and agreement.

#3 Create a Budget and Cash Flow Analysis to Deal with Divorce

The third step in our divorce mediation process is creating forward focused budgets and a cash flow analysis. With our guidance, you’ll create a realistic, forward-looking spending plan to implement and rely on as you rebuild financially post-divorce. 

Each member of our team is a Certified Divorce Financial Analyst so we go over: 

#4 Got Kids? Figure out their Post Divorce Reality

The fourth step in our divorce mediation process is for parents. We believe that while your marriage ends, your family continues and care should be taken to ensure you enjoy healthy lives and relationships post-divorce. We’ll help you create a parenting plan (not an order) to meet your children’s needs and family’s best interest. 

#5 Negotiate and Agree with your Soon to Be Ex Spouse 

The fifth part of our process is negotiation and agreement. With all the details about your income, property, budgets, and parenting factors in mind, we’ll make sure you have what you need to have effective conversations with your counsel and other advisors and successfully finalize your divorce. 

Relevant documents we’ll complete include: 

# 6 Come to a Conclusion by Finalizing with Documents/Checklists

The final step in DRCC’s process is the mediation conclusion.  We empower both of you with a plan for successful implementation of a post-divorce life—one that meets the unique needs of your family. This includes a thorough post-divorce checklist review. 

With so many what ifs and contingencies, even type B personalities are not immune to the stress of divorce. Did you know divorce is ranked #2 on the The Holmes-Rahe Stress Scale, right behind the death of a spouse? For an overview of our process, check out our divorce mediation roadmap. Better yet, when you’re ready to move closer to a better post divorce future, take the next step with a 20 minute complimentary phone consultation with a member of our team. We’ll both ask clarifying questions to better understand what is happening with you and your partner. 

You’ve decided to get a divorce. Notice we said “you've” not “you both.” To be clear, ONLY you have decided to divorce. When this happens, the decision-making spouse has a few options for how to proceed. 

  1. Talk with your spouse before deciding whether to DIY divorce, or hire an attorney or mediator.
  2. Call a divorce lawyer ASAP. You need to jump on a Zoom call or talk to them right now! 

In this blog, we want to show this spouse that their options are not as limited as they believe. Many people are so scared and unsure about their divorce options that they think their ONLY option is to proceed in secret and call a divorce attorney, or talk to anyone but their spouse. They jump right to Step #2 and start looking for “a bulldog” or a “tough, take no prisoners” divorce attorney. 

Let’s discuss why this choice may be self-sabotaging. The the two of you decided to make a lifelong commitment to each other. If you take your concerns to a divorce attorney before you talk to your spouse, they may see this as being so disrespectful that there is no way you can have an amicable divorce. Remember, a peaceful divorce is especially important when that person will be your co-parent. 

Why do people call a divorce attorney first? 

They’re not emotionally prepared to divorce. They may be frustrated, angry, or disappointed with their spouse but they’re not clear headed enough about the process to proceed and unsure their post divorce future, so they “lawyer up” first. 

Even if their intention was not to beat their spouse to doing the same, they have effectively guaranteed that their divorce proceedings will be fraught with conflict, expensive and unnecessarily stressful. 

To be sure, if your partner is abusive and controlling, you may need to contact someone outside of your marriage BEFORE have the difficult divorce conversation. However, we’ve met many spouses who called a divorce attorney first and later wish they’d chosen Step #1. 

Even if your intention is just to gather information, or you’re following the advice of a friend who has been through a divorce, your spouse will feel betrayed and it is hard to come to an agreement with someone when you’ve fired a warning shot. 

A divorce attorney will be looking out for your interests and yours only. Meanwhile, your spouse will have to hire their own divorce lawyer. Now you have two high priced advisors looking to score a win. When one spouse wins, the other inevitably loses. Do you see where we are headed with this? 

If you have the tough conversation first, you have an opportunity for divorce mediation. The discomfort you feel having to initiate the discussion will pale in comparison to the conflict you usher in by calling a divorce attorney. 

But What If I Don’t Know How or When to Have the Tough Talk? 

First off, bringing up “divorce” during a fight is not a good idea. Emotions are heightened and make us unpredictable. If you say something in that moment, there’s no easy way to press pause and return to the subject when you’re more clear headed. 

Find a time of day where you are not stressed or sleepy to have the divorce talk. In terms of the ideal time, treat it the same as you would if you had to deliver bad news. 

Make sure that you are in private and out of earshot of your children. Try not to use phrases like, “I don’t know, I am not sure but…” Be 100% sure that divorce is the next step.  

What Should I Say to My Soon to Be Ex?

A Huff Post article offers wise advice about finding the right words: It’s much more powerful to state your feelings about the relationship clearly, honestly and as kindly as possible, rather than calling your spouse on all the things you think they did wrong in the marriage.”

Do not expect to have a “one and done” conversation. Be prepared to table some topics to talk through at a later date. This is not the time to compartmentalize your life and shut your spouse out. To arrive in at a place where you can agree on property division and child or spousal support, don’t think that you can only discuss divorce inside a mediation room or an attorney’s office. 

If you choose Step #2 and talk with your spouse about divorce, you’ll know if they want to move forward in an amicable way. Consider how divorce mediation meets you where you are. Divorce does not have to be devastating if the two of you can agree that a contentious divorce is unnecessary. 

The divorce professionals at the Divorce Resource Centre of Colorado have helped thousands of couples change the way society divorces. Call to set up a complimentary phone consultation with one of us and your spouse. In person or virtually, we help soon to be ex spouses find common ground without conflict. 

Ah debt. A four letter word indeed. When you and your spouse divorce, what happens to your joint debt? This blog explores your options for dealing with shared debt and includes a few suggestions for avoiding conflict about debt before divorce. 

Come to An Agreement and Put It In Writing

If you and your soon to be ex-spouse are communicating well AND the debt cannot be immediately paid off, AND you can trust them, create a written agreement about who will pay which debt.  This includes mortgage debt, line(s) of credit, auto loans, student loans, and credit card debt.

Remember that the creditor doesn’t care that you’re getting divorced. They only care that both of your names are on the account. You may call and ask that one of you be taken off the loan but unless the remaining account holder is in a better situation financially than they were when you both took out the loan, it is likely the creditor will deny your request.

As long as your name is attached to the loan - you are ultimately responsible. The agreement you make in divorce does not supersede the loan agreement. Even if you make an agreement, circumstances can change. So, as long as your name is on the account, make sure you can monitor whether payments are being made. Furthermore, make sure that the creditor has your current phone number, email and address so important notices can reach you. 

One Spouse Agrees to Buy the Other Spouse Out of the Debt 

If one or both of you is financially able, you could offer to buy the other spouse out of the debt. This means one of you gets a new line of credit or loan on your own, paying off the existing joint account(s). This might occur if you have a mortgage together and one person wants to, or is able to do a buyout to keep the house. However, in any buyout, each party bears a risk. The selling spouse could lose out on future appreciation, and the buying spouse may end up feeling the price was too high if the property depreciates in the future. 

There is more than one way to buy out your spouse’s interest. The buying spouse either refinances the house and takes out a new mortgage loan—or gives up other marital property worth about as much as the selling spouse’s share. For example, one spouse might keep the house in exchange for giving up his or her share of marital investments and retirement accounts.

Settle Up the Debts and Never Worry About It Again

If you are able to make money on the same of the marital home, you can agree to pay off your joint debts and you avoid having to keep track of whether your ex is making payments. It is prudent to walk away from divorce debt free, when possible.  If it is not, make sure you have protections in place to guard your credit.

What if the home is the joint debt but one or both of us wants to stay? 

If the joint debt is the home and neither one of you can afford to make the payments alone, you may be faced with a choice to: 

If Divorce is Looming and You Share Debt

  1. Make sure you have access to all jointly held accounts. This can be accomplished by creating an account or registering on the creditor’s website. You may need to call and verify the information you originally submitted to the creditor. 
  2. Devise a plan to pay your share of joint debts BEFORE your divorce is finalized. Avoid having to create a debt division agreement by wiping the slate clean before you meet with a divorce attorney or mediator. 
  3. Stop making charges on your joint credit card. If you absolutely need to use a credit card, open up a credit card in your name only. 
  4. Understand if you or your spouse are an authorized user or if you both jointly hold the account. There’s an important distinction because if one spouse is an authorized user, the primary account holder could put a spending limit on them, which they couldn’t do if the spouse jointly holds the account. 
  5. As a joint account holder, a credit card company usually won’t remove your name or your spouse’s name from the account. You could, however, close the account and keep the other cardholder from adding any other charges to the account.

Empowered by Education

At the Divorce Resource Centre of Colorado, education is empowering. Here's a related blog post where you can download divorce related financial documents.

Please schedule an initial consultation to discuss your unique situation. We can also be reached at (303) 468-5626.

You and your spouse have agreed to divorce but not on how to get there. You want divorce mediation but they remain unconvinced that it is the best choice. How do you move forward with the divorce? 

The answer depends on WHY they are hesitant about mediation, IF they can be transparent and WHETHER they are willing to compromise. 

We’ll explore each of these factors and provide advice based on your answers to the questions below. 

Why Are They Hesitant About Mediation?

Scenario 1: They’re unfamiliar with the process. 

Scenario 2: They’re angry and don’t want to do what you’ve selected. Angry people want to win and hurt the other person in the process.  

Scenario 3: They want a DIY divorce to save money paying a mediator or an attorney. 

Scenario 1: They’re unfamiliar with the process. 

It is actually pretty common to be unfamiliar with divorce mediation. After all, we’ve grown up on a TV diet where we’re served images of hard-nosed attorneys going head to head, saying things like “Not on my watch” and “We’re going to make them pay!” and we resign to the fact that divorce attorneys exist for a reason. If you didn’t need them, why would they even practice that kind of law, right? 

There are many ways to familiarize someone with divorce mediation. One way is to find a friend or friend of a friend who has used a divorce mediator and ask them if they’d be willing to talk about their experience.  Another way is to ask your spouse to call a divorce mediator who offers a free consultation and come prepared with questions. You can also learn a lot by reading articles and watching videos. We’ve written about the different divorce options in Colorado and have videos about divorce mediation that can help. 

Divorce Mediation Overview

The 50,000 foot view is this: Divorce mediation works when spouses can work well together. Each spouse agrees to fully disclose their finances and work towards an agreement about property, parenting plans and what they want their post-divorce lives to look like. Your mediator is a neutral, third party who helps both of you come to consensus and stay out of the courts and avoid costly legal battles. Divorce mediation may also involve financial experts, therapists and divorce coaches. At DRCC, our team members hold the following titles: CDFA, Certified Divorce Financial Analysts, Psychotherapist, Mediator and Divorce Coach. We’ve got you covered!

Scenario 2: They’re angry and want an attorney.

To them, an attorney = they come out ahead. After all, divorce attorneys charge $350-$600/hour so they will work hard to make sure your spouse prevails. In a scenario like this, you and your soon to be ex may need to work with a therapist, together or separately or both to help resolve these feelings before proceeding with the divorce. This is not about “striking while the iron is hot” but “waiting until cooler heads prevail.” Angry people don’t make the best decisions and hiring an expensive attorney and dragging your personal affairs into a courtroom will = more conflict which = more money spent.

One exception is if the spouse who is angry is also abusive. Divorce mediation is not suited to a dynamic where one party has and wants to exert control. A collaborative divorce or traditional divorce would better serve you both. 

Scenario 3: They think they can DIY divorce.

Blame it on Pinterest or HGTV, but many people think they can cobble together a table, so why not a divorce? A DIY divorce CAN work if you do not have any children and few assets. Filing your own divorce CAN work for cooperative parties who have come to a consensus about what to do about x, y, and z; and their only difficulty is navigating the paperwork.

We have worked with couples whose situation seemed suited to a DIY divorce but later issues arose and they needed a third party to flesh out issues and make the agreements enforceable.

Hiring an attorney is not only costly due to their high hourly rate but also because of the length of the average Colorado divorce of 6-12 months, and that’s if you don't go to court. The DRCC works with couples who are motivated to complete the process in a limited number of mediation sessions. When you schedule your initial consultation and ultimately decide to hire us, we can apply the cost of the initial consultation to your account. 

Our divorce mediation services are designed for couples who want peaceful resolutions and value transparency. If this describes your situation, divorce mediation may be the best pathway to your post-divorce life.  Remember, the marriage may be over but the family goes on!

In this final installment, we cover preparing for the divorce process.

Attitude is everything when it comes to divorce

First, adopt the right mindset. The more open minded and prepared you are, the more smoothly your divorce will go. Get clear on your priorities post divorce and if at any time,you waiver or are unsure of how to continue, your priorities will help guide you to the post divorce life you envisioned.

Pick the best divorce team

Secondly, assemble the right divorce team. A DIY bookcase assembly is one thing and a DIY divorce is a whole other thing entirely. Divorce professionals include mediators, mortgage lenders, Certified Divorce Real Estate Experts aka CDREs, therapists, divorce coaches, attorneys, tax professionals and Certified Divorce Financial Planners or CDFPs. Divorce professionals know how to cut through the noise and keep the process moving smoothy.

Interview divorce professionals using the following questions:

  1. How do you work with other divorce professionals? Do you already have partnerships in place?
  2. When I email or call, how soon can I expect a response?
  3. May I call some of your references?
  4. How should I prepare for meetings?
  5. Is there anything I can do to keep my costs down?
  6. What is included in the cost of your services?

Seeking a divorce professional with a compatible personality is important since it shapes the kind of interaction they have with your spouse and other divorce professionals. If you bring in a strong arm attorney, they will approach your divorce in a combative, reactive way. If your goal is a peaceful resolution, select a mediator who shares this goal.

Your team also extends to family and friends who are supportive and want to help you through this difficult transition. There is nothing weak about reaching out for help. Like Barbara Streisand sang, "People who need people are the luckiest people in the world."

When assembling your divorce team, consider calling on mediators and certified divorce financial planners (CDFPs) early to help you sort out your finances while keeping in mind your desire to minimize conflict. After all, while the marriage has ended, the FAMILY continues.

Assess Your Finances

Now that you have your mindset and your "team" in place, choose the divorce option that aligns with your priorities and preserves your assets. It is important to bring about the end the marriage but with a focus on rebuilding your life.

To rebuild financially, you need to take inventory. As a general rule, save logins and passwords, download as many documents as you can find to a flash drive, keep 3-6 months of pay stubs, two years of tax returns, and your most recent retirement and investment account statements.

Order a copy of your credit report. You may be surprised at what it reveals. You may order a FREE copy at annualcreditreport.com

Finally, remember the 4 C's from The ABC’s of Divorce for Women by Ginita Wall and Carol Ann Wilson.

Careful - You are making decisions during divorce that have long lasting consequences. Proceed carefully by asking questions, getting clarification and relying on a team of divorce professionals.

Cognizant - It is easy to want to bury your head in the sand during stressful life transitions, but you need to keep yourself open minded and clear headed during divorce.

Centered - In addition to self-care, being centered means that you are focused on what your post divorce life will look like. Don't allow a petty argument over a household item to derail your mindset.

Courageous - Many spouses, in an effort to lower stress or make their children happy, put their priorities and needs on the back burner. Resist the urge to "go with the flow" and advocate for yourself.

As a reminder, in "The Devil's in the Divorce Details" we have covered:

Click on any of the above segments to view the video and associated blog post.

If you, or someone you know, is contemplating divorce, please share these articles with them. To book a complimentary 20 minute phone call with one of our divorce experts, book here.

For Important Divorce Documents, Complete the Form Below!

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Forms include: Asset Worksheet, Household Goods Inventory, Financial Checkup, Priorities Worksheet and Mandatory Financial Disclosures.

In this post, we cover the divorce options in Colorado. Your choice include a do-it-yourself or DIY divorce, divorce mediation, a collaborative divorce and traditional divorce involving an attorney,

Option 1: Do it Yourself Divorce

The first option is a DIY or do it yourself divorce. You may also hear “pro se” or “kitchen table divorce.” This kind of divorce requires that you download and file the divorce forms yourself. The cost is $250 plus the time it takes to complete the documents.  A DIY divorce is best suited to marriages that were short in duration, where the couple owns few assets and has no children. 

The advantages are that you can keep your privacy, only the fact that you’re divorced becomes public knowledge, while any details remain between the parties. The other obvious advantage is affordability when compared to a traditional divorce that can cost between $10,000-$30,000. 

The disadvantages of a DIY divorce, if things go south, will negate the cost benefit.  If either party misses something or complete the forms incorrectly, one or both of you will incur costs trying to fix mistakes. Or, if one party fails to uphold promises made in the divorce documents, they are not legally binding so you cannot use the courts or an attorney to enforce the issue. In a DIY divorce you can hire a divorce or family law attorney to review your documents at a rate that varies between $150-$250/hr.  The cost to review would be a limited scope legal service. Look for attorneys who offer “unbundled services” as they complete tasks on an a la carte basis. Another drawback of a DIY marriage is that the forms fail to take into account what a post divorce financial reality will look like. 

Option 2: Divorce Mediation 

The second divorce option in Colorado is divorce mediation. Divorce mediation occurs when both parties agree that the marriage is over and they are committed to coming to an agreement. Both parties are free to consult with an attorney but the mediator is the one who works to bring the parties to a consensus to ensure a post divorce peace can be achieved. Divorce mediators come from a variety of backgrounds. In Colorado, they don’t have to pass a test or have a certification to be in business. Look for a mediator with experience, both in the number of mediations they have performed but also consider their background in family law, psychology or financial expertise. If you’re lucky, your mediation team will bring all of these elements to the table. The mediator works to ensure the settlement agreement is based on the family’s sense of fairness. 

The advantages of divorce mediation are affordability, privacy, less stress and your ability to control the outcome. The cost of divorce mediation ranges between 5,000-10,000. Settlement agreements remain private, as do the particulars of said agreements. Contested divorces or divorces that become contentious and lead both parties to seek their own attorneys are stressful for the children as one side seeks to eek out a win against the other. Having control over the direction of your divorce correlates to less animosity. After all, you were a participant, so if you objected to something, you had the opportunity to do so in mediation. 

The disadvantages of divorce mediation occur when you select a mediator who does not do their due diligence or is inexperienced. If one party has agreed to mediate but has a very difficult personality, seek a mediator who has experience with conflict resolution or dealing with difficult people. 

Option 3: Collaborative Divorce

The third divorce option is the collaborative divorce model. Deb Johnson of Divorce Resource Centre of Colorado and other divorce professionals helped pioneer this approach in Colorado twenty years ago. Collaborative divorce includes a team of four professionals. The first two are collaboratively trained attorneys chosen by each spouse. You will want to search for “attorneys in Colorado and collaborative law” The third team member is a financial professional with experience dividing assets, calculating future earnings and knowledge of divorce tax implications. The fourth team member is the mediator. The collaborative divorce process is needs based vs. the adversarial approach of a traditional divorce. There is full financial disclosure by both parties as the team works to gather, organize and manage the needs of both parties. 

On the plus side, a collaborative approach is bringing together the most expertise to the process than a traditional divorce. In a traditional legal model you have the parties, an attorney and possibly a judge. Unless they are the rare exception, neither the judge nor attorneys are experts in the financial realities of divorce. A collaborative divorce is an option where there are tough issues involved but both parties realize that experts can help resolve some of the financial and emotional hurdles. 

The disadvantages of a collaborative approach is that it costs more than mediation and DIY. Estimates vary but 10-20k is a range depending on the issues and time required to resolve them. All four divorce professionals have varying rates and need to be compensated for their time and expertise, driving up the cost. The timeline is longer than DIY or divorce mediation so expect six months to a year to complete the collaborative process. 

At the onset, the attorneys and their clients sign an agreement that if collaborative divorce cannot be reached, everyone walks away and continues the divorce in a traditional or litigation model. This agreement operates as an incentive to continue to work collaboratively less you lose money and time. 

Option 4: A Traditional Divorce

The fourth way to become divorced in Colorado is via the traditional model. Despite the threat of a spouse saying, “I’ll see you in court.” more than 95%  of divorces don’t end up in courtroom but are settled outside of court. The traditional divorce model is the pathway when one party does not agree to divorce. The divorce is contested which rules out the ability to go with the other three options. 

Disadvantages of a traditional divorce

The disadvantages of a traditional divorce are numerous. There is the cost of retaining an expensive divorce attorney. There is the public reveal of the particulars of your divorce. All parties are subject (read: at the whim of) the timelines and schedules of attorney and judges. There is no collaboration but instead an atmosphere of win or lose, take or be taken. People who are not experts in psychology or finance are the final arbiters of settlement agreement, maintenance and parenting plans. The timeline to completion ranges from a minimum of six months to a few years. If one of the attorneys misses something or is inexperienced it will cost more to hire another attorney to fix the problem. The issues are prioritized by an attorney even if the divorce stays out of court and if it goes to court, the issues are further streamlined to ensure ONLY the most pressing ones are worthy of the court’s time.   

Advantage of a traditional divorce

The main advantage of a traditional divorce is when one or both parties is unlikely to cooperate or keep a promise, the heavy hand of the law will enforce any agreements. Some people need court enforced boundaries and calls to act properly. 

The Divorce Resource Centre of Colorado employs certified divorce financial analysts, a psychologist and divorce coach. All of our mediators are well versed with the collaborative law approach and with working with difficult personalities. 

It’s important to know all of the divorce options available so you can make an informed and empowered choice that aligns with your family’s unique situation. In our complimentary 20-minute consultation, clients explain their situation and we can recommend ways to move forward.  We invite you to call us at (303) 468-5626 or schedule a time to talk. 

For Important Divorce Documents, Complete the Form Below!

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Documents include: Asset Worksheet, Household Goods Inventory, Financial Checkup, Priorities Worksheet and Mandatory Financial Disclosures.

Sharing the same square footage 24/7 can either bring couples closer together or exacerbate already existing problems that were simmering just below the surface. If you find yourself in the latter camp, how do you begin to even investigate your divorce options?

The Divorce Resource Centre of Colorado is committed to helping families divorce peacefully, preserve their assets and create a stronger post divorce family. We're prepared to answer your questions, with or without a pandemic thrown into the mix.

Should I divorce during a global pandemic?

You're running through a litany of questions related to what divorce will mean for you, your spouse, your children and your finances. In light of the unstable economy, you may worry about how to survive on one salary or worse, none if you become, or were already furloughed or laid off.

Our wealth of experience has led us to two questions we believe spouses must answer before they call an attorney or seek the assistance of a divorce mediator.

We delve into these in much more depth in a separate blog post but they bear repeating here.

  1. Do you both want the divorce?
  2. Are you both peacefully and respectfully able to begin the divorce process?

If the answer to BOTH of these questions is a resounding yes, there is no reason you can't start the divorce process during COVID19.

If the answer to either question is unclear, we still recommend you consider what your post divorce life should look like. There's no harm in preparation that takes into account your guiding principles. For example, if you value stability in all matters, you intend for the children stay in their current home.

There is a lot of ground to cover in the divorce preparation process and that's how the role of a divorce coach came into being. We can't say it much better than the ABA, "divorce coaching is a flexible, goal-oriented process designed to support, motivate, and guide people going through divorce to help them make the best possible decisions for their future" Luckily for us, and you, Divorce Resource Centre of Colorado's Suzanne Chambers Yates is a Certified Divorce Coach. 

Based on our experience, we created a divorce checklist on the bottom of our website's home page that encapsulates many of these pre-divorce considerations.

To get crystal clear about your priorities, write them out and be as specific as possible. If you wrote, "to have enough money to pay a mortgage or monthly rent" that makes sense, but have you considered whether your post divorce budget will include the money to continue your children's extra curricular activities?

We also recommend you complete an inventory of your valuable household items with the help of our Household Inventory Worksheet found at the bottom of this page.

The financial aspects of the divorce, which are just as important as the emotional, will be explored in two upcoming video segments on 5/22/20 and 5/29/20 on our page's Facebook Live.

Prepare how you will talk to your spouse and the children about divorce

Before you can answer the two questions above, you must have the tough conversation. Thinking through your "divorce talk" approach is crucial because it sets the tone for the entire divorce process. If you need advice on how to prepare, mediators and divorce coaches have the experience and are committed to a peaceful resolution. Compare this to an attorney who is ultimately concerned with the dissolution of the marriage and achieving the best outcome for the spouse who hired them.

As hard as it may be, you must be ready to listen to what your spouse wants. The conversation will be trying but it cannot be a monologue where you list out all the reasons your marriage should end.

We are available for a 20 minute complimentary phone consultation where we hear your specific situation and let you know about your divorce options.

We also offer a 90 minute session (in person or over video conference) with both parties to dive deeper into our holistic process and preview post divorce outcomes. You will walk away, or step away from your computer in the age of Zoom, being empowered and informed.

If you have other concerns, we can be reached at (303) 468-5626.

For Important Divorce Documents, Complete the Form Below!

* indicates required

Documents include: Asset Worksheet, Household Goods Inventory, Financial Checkup, Priorities Worksheet and Mandatory Financial Disclosures.

ABOUT
At Divorce Resource Centre of Colorado, we have a team of seasoned Certified Divorce Financial Analysts (CDFA) who provide a cost-effective, respectful mediation process that allows couples and families to rebuild a secure post-divorce future.
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10789 Bradford Road, Suite 205, 
Littleton, CO 80127
Phone: (303) 468-5626
Toll-free: (866) 447-7171
Email: info@drcofcolorado.com
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