In a traditional divorce there are four parties: the divorcing spouses are one and two respectively and their attorneys make four. Nowadays, it may take a village if you want to cover your financial, emotional and property related bases. When you think about your divorce, only a portion of the divorce is legal (because it is a legal process), the majority of your divorce is centered around finances, parental responsibilities and communication.
Divorces have evolved to take into account that divorce attorneys, experts in the law, are not financial experts. Rather, a new specialization, Certified Divorce Financial Analyst or CDFA, is held by financial professionals who can assist with your divorce.
Divorce is emotionally daunting and while you may be aware of individual and family counseling, do you know how a divorce coach works and why you might need them and a therapist?
When a couple divorces, the most valuable asset is usually their home. There is often a rush to sell it to be able to finance the purchase of separate homes. But not so fast. You need a realtor who understands the legal and tax aspects of the divorce process as it relates to real estate - someone with CREDS after their name. And, remember it is important to know how much of a home you can afford after divorce and what your cash flow will look like, so that selling and buying homes at the time of divorce will not end up being a costly mistake.
But before you start calling CREDS realtors, you’ll want to enlist the help of a Certified Financial Divorce Analyst, CDFA,and a Certified Divorce Lending Professional, CDLP, who can make sure your mortgage choice aligns with your long and short-term financial and investment goals, minimizes taxes, interest and maximizes cash flow.
That’s why in this blog, we’ll explain how you can build your divorce team. We’ll introduce you to divorce professionals with the experience and training to best help you during this taxiing time.
In reality, to avoid costly post-divorce conflicts, you only have one chance at getting your divorce done right! Surrounding yourself with the right team of professionals to assist with your divorce is a MUST. The Divorce Resource Centre of Colorado believes that having different advisors on your team will enable you to get the best possible outcome.
There are three areas where CDFAs differ from other financial professionals: 1) Financial and tax expertise and strategy 2) Data Collection, Organization and Analysis, 3) Settlement Consultant, and 3) Ability to act as an expert witness if needed in court.
CDFAs:
CDFAs:
Finally, a CDFA can be called on to act as an expert witness if your divorce goes to court.
Source: CDFA page
2) Divorce Coaches
A divorce coach is a confidential, thinking partner. Their process begins where you are and enables you to create your path forward. They will guide you through the steps of divorce and unlike a therapist, a divorce coach is concerned about the practical to-dos of your divorce and making sure they’re done. Some divorce coaches have specializations based on their experience. The Divorce Resource Centre of Colorado’s divorce coach, Suzanne Chambers-Yates, specializes in high conflict divorces and narcissists. Her background is in mediation and mental health.
While a relationship with a therapist or a divorce coach is predicated on trust and confidence, they help in different ways. Therapy focuses on the past, your family of origin and how you got to where you are. Coaching is future focused - where are you now and where you need to get to, or gaining clarity on where you are going. It is an action and goal oriented process. A divorce coach will help you manage the overwhelm.
A realtor with this designation will have CREDS after their name. They are trained in the legal and tax aspects of the divorce process as it relates to real estate. They learn obscure legal rulings, regulations and tax implications. This specific training allows them to help their divorcing clients take advantage of tax laws that are specific to selling a house in the divorce. Source
Other initials that indicate divorce related expertise:
Rather than one spouse engaging with a realtor, a realtor who is specialized in divorce works with both parties as a neutral advisor. CREDS, et. al realtors have completed courses on how to manage differing emotional states and high-tension situations and they act in a way to encourage both parties' opinions are considered.
A CDLP™ uses their knowledge and expertise to help the divorcing homeowner make a more informed decision regarding their home equity solutions and mortgage financing choices. A CDLP understands the connection between Divorce and Family Law, IRS Tax Rules, and mortgage financing strategies as it pertains to real estate and mortgage financing in a divorce situation. Source
At the Divorce Resource Centre of Colorado, each member of our team is a Certified Divorce Financial Analyst. One of our team members is a Certified Divorce Coach, and two members of our team are divorce mediators. We work with CREDS certified realtors and mortgage lending professionals who have obtained the CDLP designation.
Consolidating your mediator, CDFA and divorce coach means you are getting more for your time and money and minimizes the number of professionals you’ll need to interview, and enabling you the best outcomes for your divorce, while preserving your assets and sanity! To see if our team is a good fit for your divorce needs, schedule a no strings attached 20 minute call with a member of our team today!
A “mature divorce” or gray divorce occurs when both parties are over the age of 60. You may hear ages like 50+ or 65 + but for the purposes of talking about Social Security and Medicare, 60+ applies to the information here. Gray divorces are increasing even as divorce rates are plummeting among Generation X and Millennials. In this blog, we discuss WHY later in life divorces are becoming more common and WHAT makes them uniquely challenging.
Census Bureau data from 2018 shows that 28% of the residents 65 and older in Denver, Colorado are divorced, the highest percentage of the 133 cities in a study done by Smart Asset. Now that we know Denver is leading the charge, why are we seeing so many gray divorces? First, if you are over 65, there is a higher chance that you are in a second marriage, with a divorce rate 2.5 times higher than first marriages. Secondly, according to the World Bank, life expectancy rates in the U.S. continue to rise, reaching 78 years of age compared to 76 years old in 2000. No one wants to be stuck in a marriage later in life when there's MORE life to live!
Other reasons for high later in life divorce rates is there is no longer a desire to stay together for the kids, what they once had in common has changed, they want to rediscover their sexuality, or one or both partners are experiencing health issues. Another reason given may be that women put a lot of importance on happiness, whereas men are more willing to put up with a less than ideal marriage.
Gray divorces can be tricky, so let's begin with the elephant in the room: Money
When you are 65+, you have a lot less time to rebuild your finances than a 35 year old divorcee would. Gray divorcees look to their retirement accounts as one of their most valuable assets.
They're on the table. Colorado is an equitable division state, meaning that marital property - all property acquired during the marriage, and marital appreciation on pre-marital property, is to be divided equitably. Equitably doesn’t mean equally. It means the court or mediator considers a variety of factors to come to a fair decision. Factors include the financial situation of each spouse, the ability of each person to earn income, the ages of the parties, and the duration of the marriage.
When dividing retirement accounts you’ll need to be aware of tax considerations (was the account funded with pre-tax or post-tax money?), vesting of employer matching contributions, and they may require special orders like a QDRO, Qualified Domestic Relations Order to divide them.
The money in a 401(k) plan is divided without regard for who actually contributed. Employer contributions, like the employee contributions, are divisible marital assets if made during the marriage.
Especially in a state like Colorado, with an extremely high cost of housing, it may be impossible to support two separate households on one retirement account. This could lead to a party, or both parties moving out of state, continuing to work past a planned retirement or reduce their standard of living.
While Colorado law prevents the spouse with employer based healthcare to remove the other spouse during the divorce process, Colorado Revised Statutes 14-10-107 (4)(b)(I)(D) the other spouse should still look for replacement coverage. If you are covered through your spouse's workplace, you may be entitled to COBRA coverage. Here’s more information from us on health insurance post divorce.
Spousal maintenance, (the IRS calls it alimony), is considered to be a financial rehabilitation tool to make sure the earning or stay at home spouse does not become destitute after the marriage ends. Maintenance (or alimony) is also dependent on the amount of assets each party will have to rely upon financially post divorce, the health and employability of both spouses. The most common scenario for gray divorces is permanent spousal maintenance. It is not conditional upon the spouse receiving support to gain job skills or more education. Instead, it acknowledges that finding suitable employment is unlikely, such as the case with a 65 year old divorcee who hasn’t worked in many years. The health of the lower earning spouse is also extremely important as healthcare expenses increase with age. Terminating spousal maintenance in Colorado happens automatically when the supported spouse remarries or dies but doesn’t change when the paying spouse remarries.
Spousal support falls into the category of ‘cash flow’ when working through the financial components of a divorce, and while there are guideline statutes in Colorado, it is important to look beyond those guidelines and look at both party’s current and post-divorce financial situations.
While divorcing later in life carries with it many complexities that the under 50 age group isn’t faced with, it can be done successfully with the proper planning.
What About Long Term Care?
If it is foreseeable that one or both spouses will need long term care, in home care, transportation or modifications done to be able to remain in the home as they age, this should be brought up during mediation.
Social security - If you are going through a gray divorce, you need to consider the effect it will have on your Social Security benefits. The potential income stream through Social Security should be considered at the time of divorce, and you should understand the consequences of remarriage on your Social Security benefits. For instance:
Although the court cannot divide Social Security benefits at trial, parties in a gray divorce may qualify for benefits based on their spouse's earning history. This is common when one spouse earned significantly less income in their marriage than the other spouse. These benefits will generally end if the spouse receiving them remarries.
Under the Social Security laws, a former spouse is entitled to the greater of 100% of their own benefit or 50% of their former spouse’s benefit (the retired worker spouse still receives 100% of their benefit). To receive Social Security benefits based upon your former spouse's earnings record, the following criteria must be met:
The actual payment to the lesser-earning spouse is an amount from that spouse's personal benefit plus a portion of benefits based on their former spouse's record to reach the higher amount.
If one of the former spouses dies, the other may be entitled to survivor benefits (also called death benefits) if your marriage lasted longer than ten years, you are currently unmarried, and aged 60 + (or aged 50 if disabled)
To collect spousal (and former spousal) Social Security benefits, the lesser-earning spouse does not have to wait for their former spouse to apply for Social Security benefits if they have been divorced for at least two years.
Delayed retirement credits (an increase in Social Security benefits if you delay retirement past full retirement age) are not included in Social Security benefits based on the record of the former spouse. However, if you have reached retirement age and are qualified to receive your former spouse's benefit, you may elect to receive only the former spouse benefit and delay your own retirement and receipt of benefits. A retirement delay could allow your personal benefits to catch up to or surpass the spousal benefits you are receiving.
Medicare is a federal program of health insurance for people age 65 and over (generally). The benefits are individual and uniform, unlike Social Security.
Medicare benefits begin when the beneficiary turns 65 and gets Medicare Part A (hospitalization coverage), which has no premium, and is eligible to receive Medicare Part B (doctors, labs and outpatient services), which does have a premium that is indexed for inflation each year.
People who are still employed beyond age 65, and who are covered by their employer’s insurance (together with their spouses), can elect to NOT sign up for Part B, thus avoiding paying the premium without incurring a late sign up penalty. If an employee retires or otherwise loses employer coverage, the employee (and his or her over 65 year-old spouse) MUST sign up for Medicare Part B within 63 days of losing coverage, even if the employee is offered COBRA benefits. Failure to do so incurs a Medicare penalty for late sign up that is both expensive and permanent.
Many people who turn 65 and are not covered by a company sponsored retirement health plan can buy a Medicare Supplement (or Medigap) policy to make up for Medicare shortfalls. If a divorcing couple has a company (or government) sponsored retirement health plan (which essentially acts as a Medicare Supplement plan), the plan itself has its own rules about whether or not a divorced spouse can be covered, and whether it covers the surviving spouse or the surviving former spouse of the actual retiree. Bottom line: check with your company’s human resources department.
Remember, your will and powers of attorney become null and void at the time of divorce. It is crucial to redo your will, update your powers of attorney, for both health care and finances, to a trusted friend, family member or an adult child, or an institutional provider.
Gray divorces and all the moving pieces can be complicated! And, because the clock continues to wind down at that stage of life, mistakes are too costly! But with guidance from a qualified financial divorce mediator or attorney, issues regarding retirement, healthcare, and Social Security are clarified for you. If you are contemplating a gray divorce, receive a complimentary consultation by scheduling a 20 minute call with one of our divorce mediators. Or call us at 303-468-5626 to find out more.
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.
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.
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.
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.
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.
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.
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.
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.
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:
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.
Colorado courts trailblazed the way to a new definition of common law marriage in January 2021. The court’s longstanding view of common law marriage, established in 1987, is now more realistic and less traditional. Previously, Colorado courts factored in several specific markers to establish a common-law marriage. These included questions such as "Did the couple own property together?" "Did they file joint tax returns?" "Did the woman take the man’s last name?" Now, courts take on a more nuanced view of common law marriage, which has implications for same sex couples seeking a divorce.
As more couples eschew home ownership, file taxes separately for student loan reasons and keep their own last names, these indications of “holding themselves out as being married” are less common. In states that still recognize common law marriage, and Colorado is among the nine that do, we're the first to modernize the factors courts consider whether a couple was common-law married.
The new standard is whether they mutually intended to enter a marital relationship and whether the couple’s subsequent conduct supported that decision. Judges must look at the context and totality of the circumstances rather than checking off a list.
Consider how this shift will positively affect same sex couples. Gay couples may not present themselves as married so as not to face discrimination or to keep their relationship status private. Now with the outdated criteria replaced, more same sex couples are able to have their common law marriages recognized, and in the case of divorce, dissolved the same as any other couple. A reminder that a divorce is still necessary whether a couple is legally married or married by common law.
In addition to the main reasons divorce mediation is preferable for couples who split on good terms such as lower cost, less stress, and more control, there are four additional reasons that married or common law married same sex couples should consider divorce mediation.
1. Divorce Mediators, unlike Judges, don’t factor in how long a couple has been common law or legally married when deciding property distribution and maintenance
Same sex unions have only been legal in Colorado since 2013. This would make any legal marriage 7 years which is considered short term. This would disadvantage the lower earning spouse whereas a divorce mediator strives for equity and for the two sides to come to a mutually agreeable way to award maintenance and property.
2. Divorce Mediators Are Not Constrained by the Court's Determination of Who is the Legal Parent
Same sex couples who pursue a traditional lawyer led divorce must adhere to case law to determine who is the legal parent. If you or only your spouse is the child’s legal parent, the other party will need to bring a paternity or maternity petition to obtain custody and visitation. But If the other partner wants to become the child's legal parent, they must formally adopt. If he or she fails to do so, and the couple divorces, the “non-parent” could be completely denied parental rights—even if he or she has been the child’s primary caregiver. Contrast this with divorce mediation where custody and visitation issues are resolved without being limited to the law's view of who is a "legal" parent.
3. Choosing Your Own Divorce Mediator is Preferable than Having An Assigned Judge
Not to generalize, but there are members of any profession who hold a traditional view of marriage. When you are assigned a judge, it’s anyone’s guess whether they will treat your marriage, common law or not, the same as they would a heterosexual couple. Compare this to divorce mediators, who tend to come from a variety of backgrounds. You find the one who is a good fit and they operate as a neutral third party, giving you more control over the divorce process.
4. Divorce Mediation Is Private Unlike an Attorney Led Divorce
It is no one else’s business that you are getting divorced. Divorce mediation recognizes that marriage dissolution doesn’t have to be handled by the same people who prosecute crimes. If you are not out to the general public, your privacy is preserved inside the mediation room.
At the Divorce Resource Centre of Colorado peaceful resolutions are possible through our process that reduces conflict, contention, and cost while bolstering informed decision making and peace of mind. If you are a member of the LGBTQ community and contemplating a divorce or separation, please call our office at (303) 468-5626 or schedule a complimentary consultation with one of our staff.
There are many reasons a spouse wants to stay in the home post divorce. From proximity to their children’s school or grandparents, to giving their children “stability,” soon to be divorcees may have already made up their minds to stay put. Especially in Colorado where the housing inventory is so low, finding a new place to live is a major undertaking. We caution clients to consider the practical and financial concerns of staying in the home. There are reasons to consider moving that may win out over stability, proximity and your or your child’s emotional attachment.
How old is the family home? Does the home's age mean you’ll need to make major repairs such as roof replacement, sewer system overhaul or foundation fixes? Unless you are a contractor, you will not be in a position to DIY these repairs.
Colorado is the second highest-rated state in the nation for homeowners insurance catastrophe claims. Our wacky weather includes hail storms, wildfires and heavy spring snowstorms. Homeowners with residences valued above 300kpay on average around $4,000 a year for homeowner’s insurance. Can you afford essentially a car payment amount each month on your own?
While Colorado has very low property taxes compared to other states, you must account for them in full each year. Property taxes vary by county and depend on the home’s market value. For example, Douglas County, Colorado has the highest property taxes in the state while Arapahoe County is on the lower end with an effective tax rate of .61% to Douglas Countys’ .66%. Colorado home values keep rising, sending property taxes on an upward trajectory. In an attempt to rein in taxes, voters passed Amendment B during the November 2020 election. This has led to a freeze of property tax assessment rates at the current rates (7.15% for residential property and 29% for non-residential property); a provision for future property tax assessment rate decreases.
Note that Colorado has a senior tax exemption for homeowners 65+ who have owned and lived in their home for at least 10 years prior to January 1st of the application year.
If you have a mortgage or HELOC you can deduct interest for loans used to buy, build or substantially improve your home or second home. But you can’t if the home loan was taken out to pay down credit card debt. You can only deduct interest paid on the first 750k of these loans if you financed it before January 1, 2017
Even if the maintenance, insurance and taxes are not problematic, will you be able to qualify for a refinancing of the loan? Do you have a high debt to income ratio? How high, or low, is your credit score? Moreover, how liquid are your assets? Can you access the money you need to pay your spouse for their equity in the home? While it is a good idea to preliminarily investigate different mortgage options, don’t apply for a mortgage until you are ready, since doing so can negatively affect your credit report.
Find a property inspector who is trusted and impartial to walk you through the home inspection process. They can find the problems you may not know about like wiring, plumbing, HVAC issues, and structural damage. A recent client wanted the family home so badly, they agreed to forgo the inspection saying that they knew the house and its' issues inside and out. When their divorce was signed, sealed, and delivered, she learned of a major foundation issue in the ballpark of $50 to $60,000. Unfortunately for her, it was too late to change the agreement.
We mentioned your child’s attachment to the home and while we recognize it may seem crucial in this heightened time, you alone will be shouldering the financial and practical responsibilities.
If you have a clear picture of the costs of your home’s upkeep, property taxes, homeowner’s insurance, and can pay your soon-to-be-ex equity, then staying in the marital home post divorce might be the best option. If these considerations are preventing you from taking on sole responsibility, consider a nesting arrangement where the children stay in the marital home full time and you and your ex-spouse maintain a smaller home or apartment nearby. Usually, life changes dictate that this is not a long term arrangement but it can work if you are amicable with your ex and your child(ren) are in high school.
We work with many couples and parents who contemplate staying in the family home post divorce and recognize the emotional, practical and financial considerations involved.
Want to know what your financial, post-divorce future will look like? Please give us a call at 303-468-5626 or schedule a 20 minute consultation so we can learn more about your particular situation.
You’ve decided to pursue divorce mediation. For a host of reasons, we support your decision. Mediation is designed to preserve both parties post-divorce futures AND peace of mind. Now that you’ve decided on the HOW, it’s time to decide WHO will be your mediator. The choices are either an attorney with mediation experience or a non-attorney mediator. In this blog, we discuss five reasons why a non-attorney divorce mediator may be the best choice.
The first reason to consider a divorce mediator who is not an attorney is that they have unique backgrounds, expertise, and broad experience. Compare this to many attorneys who have worked exclusively in law and are recent converts to mediation. In law school, and for many years post-graduation, their mindset was focused on "winning" for one party. Compare this to non-attorney mediators from different fields that understand human psychology, value compromise, and aim to give both party’s needs their attention.
The second reason that a non-attorney divorce mediator may be a better fit for your needs is that their perspective is focused on gaining consensus which is usually a skill that lawyers have to be taught. In a law practice, their success was dependent on whether their side was winning or losing, not if the eventual outcome would be beneficial or fair to two parties.
Third, non-attorney mediators are more willing to bring in other experts who provide a service to divorcing couples rather than try to be all things to all people. Attorney mediators are already juggling a lot by shifting from advocacy to cooperation but many also try to be the one stop shop for emotional and financial issues. Non-attorney mediators value collaboration and cooperation, and are more willing to bring in experts in these areas.
The fourth reason that a mediator who is not also an attorney might be a better fit is that they have more experience coming up with creative solutions. Attorneys, even those trained in mediation techniques, value logic, rules and precedent. But divorce can be illogical and rules meaningless to couples. Non-attorney mediators aren’t constrained and are able to craft outcomes that both parties can live with.
The final reason to select a mediator who is not also an attorney comes down to dollars and cents. Many non-attorney mediators, such as DRCC, offer a la carte services and payment options based on a set number of sessions. Most attorneys bill for mediation by the hour. There is more transparency and accountability when you are charged by outcome vs. when you are being billed for someone else’s time.
Divorce mediation is a unique profession independent from law. Many outstanding mediators come from non legal backgrounds. They bring unique perspectives and experience that benefits divorcing couples. Their emphasis on collaboration and creativity leads to peaceful solutions. The Divorce Resource Centre of Colorado offers a 90 minute initial consultation. If you choose to hire us, the cost of the consultation is applied to any future balance. Please book your consult here or schedule a complimentary 20 minute call.
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.
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.
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.
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!
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.
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!
Have you ever heard, “What’s mine is mine and what’s yours is mine?” or “What’s yours is mine and what’s mine is my own?” Although stated differently, the result is that one person prevails and the other is left holding the bag. Thankfully, Colorado law has a less juvenile way to determine separate and marital property.
This blog examines marital and separate property in Colorado and what happens when separate property is commingled with marital property. We examine Social Security, retirement accounts and gifts acquired during marriage.
Marital property is legally defined as “any property which either spouse acquires during their marriage, except for property acquired by gift, inheritance or property excluded by a prenuptial agreement,” See § 14-10-113(2), C.R.S.
The practical application is that marital property is subject to division, either by the courts or as agreed to in mediation. In Colorado, marital property must be divided equitably. Note that equitable does not mean “equal” division – it means “fair” division.
To do this, a mediator or a judge will take into account the separate property each spouse owns when determining how to equitably divide the marital property. If one spouse owned an apartment complex before the marriage and rents it out and the other spouse only has a 15 year old car as their separate property, this would be one factor when a judge or mediator weighs in on how to divvy up the marital property.
Other factors are each spouse’s earning capacity, their health issues, and who will have primary parenting responsibilities.
Separate property is property that acquired before marriage and treated as separate during the marriage. Treating it separately means you opened an account or invested in an asset where you are the only owner, and it is not commingled with other money or assets that are jointly owned. The main question is whether you retained the separate character of the property or gift during the marriage? Did you make deposits into this account during your marriage? Were these deposits your paycheck only? Is the property deeded to you? Are you the accountholder of the bank account?
If you can show that your actions kept it separate, the property will be deemed separate and not subject to division. However, any appreciation on the separate property from the date of acquisition to the date of divorce is considered marital and goes into the marital pot to be divided.
Think about it like this. You have your own separate property. But if you use it to buy something that benefits your marriage – you’ve commingled the two and it is now subject to equitable division.
-You inherit money and deposit that money into a joint account with your spouse, the inheritance becomes marital property.
- If you have an investment account or start an investment account and both spouse’s incomes contribute to the account, the funds in that account become marital property.
- If a relative dies and leaves you $50,000, and you use that money to pay down the mortgage on the home you both live in, that “gift” transforms into marital property. You may try to argue that the $50,000 was meant to be a gift only to you, but unless your soon-to-be ex feels generous, they still get their half of it. Bottom line, if you wanted to keep it characterized as a gift, you should have deposited it into a new separate bank account in your name only. There are many other waysto avoid commingling that you should look at before making any purchase.
Contrary to popular belief, no. If the account was created, added to or increased in value during the marriage, it is considered marital property, either completely or in part, and subject to division.
Yes. Colorado law says Social Security benefits are not subject to division, nor can they be offset by providing your spouse with a greater portion of the marital property. But there’s an exception. If the marriage has lasted 10 years or more and the claimant spouse is 62 or older, the former spouse can receive benefits on the claimant spouse’s record.
This makes sense when you consider that you’ve been paying into Social Security since you began working and the Social Security Act, § 407 specifically, prohibits the assignment of Social Security benefits in any other legal process. In 1975, Congress amended the Act to include § 659, which incorporates a narrow exception to the anti-assignment provision to enforce legal obligations to provide child support or alimony.
We have established marital and separate property and how each is treated depending on the circumstances. Whether your property division occurs inside the courtroom walls, an attorney’s office, or with a mediator, the same ground rules apply.
The Certified Divorce Financial Analysts at the Divorce Resource Centre of Colorado are uniquely suited to assist divorcing couples. We are here to learn more about your unique situation during a 20 min exploratory call that you can schedule here.
In this final installment, we cover preparing for the divorce process.
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.
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:
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.
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.
Forms include: Asset Worksheet, Household Goods Inventory, Financial Checkup, Priorities Worksheet and Mandatory Financial Disclosures.
