The relationship between certified divorce financial analysts and family law attorneys can be complicated. Each are trained to reach the best possible outcome for their clients and both are regarded as experts in their fields. Despite the appearance of competition, we believe cooperation between attorneys and CDFAs can best serve divorcing spouses.
Attorneys who handle a large number of divorces are not in the business of ensuring that every financial stone has been turned over. Once the divorce is finalized it is up to the parties to make sure the division of assets and any payments agreed upon are made. If a divorce attorney with a hefty caseload sees the value in a certified divorce financial analyst, it is usually only as a post settlement referral.
Attorneys must recognize that their clients assume they are financial experts in addition to being experts in negotiation and divorce law. An attorney must decide if they can be all things to all people. It’s a struggle between being a subject matter expert or wearing many hats. Your clients want to know that you can handle their complicated financial situation but also want to know you can also deftly handle child custody, maintenance and property division too. Lawyers have proven themselves in the study of law, a discipline of staggering breadth and can benefit from bringing in a CDFA with the financial expertise they didn't gain in law school. The client benefits and the attorney has more time to spend on the legal ramifications of divorce without being sidelined with burdensome research.
Many attorneys and CDFAs believe that since they are working with the same clientele, there must be competition and it’s an all or nothing proposition. Either the client works with a divorce attorney OR chooses mediation and works with a CDFA, or other advisor. We believe the choices are not mutually exclusive - but complementary.
Money stresses are often a major contributor to divorce and the financial implications post divorce are best understood and explained by a CDFA with rigorous financial training. If necessary, a CDFA can testify to matters in court as a neutral expert, or may work on behalf of both parties or for one spouse. Contrast this with a paralegal who works at the direction of the lawyer. Your clients will appreciate that you understand the consequences of financial projections and trust your expert opinion to bring in a professional.
While CPAs do an excellent job of estimating tax ramifications today, they are not accustomed to making future projections – like where their clients will live post-divorce or what future housing will cost. CDFAs look at the lost income effects, investment vehicles, and events that trigger taxes as well as the percentage of assets that clients plan to use for living expenses that triggers a taxable event. CDFAs, unlike CPAs, are client facing and expected to be able to distill financial speak into digestible pieces.
Having a working relationship with a CDFA frees up attorneys to focus their time on the legal issues of their divorce cases without learning or relearning financial issues regarding divorce, ie tax implications, cash-flow, etc. Additionally, CDFAs can prevent their clients from signing a marital settlement agreement that might hurt them in the future.
If an attorney makes a financial mistake, they could face a claim of malpractice. Ensure against this by hiring a CDFA since they are certified in all the financial nuances of divorce, including taxation and pension valuation. By working together as a team, the lawyers are able to shift some of their malpractice liability to the CDFA who must maintain professional liability insurance coverage.
The Divorce Resource Centre of Colorado is led by Deb Johnson, a Certified Divorce Financial Analyst and Suzanne Chamber- Yates, a certified divorce coach and Collaborative Divorce Facilitator. Both are professional mediators who have worked with many attorneys in the Denver Metro area.
If you are interested in continuing the conversation of how a CDFA can assist your legal practice, let's schedule a time to talk. You can reach us directly at deb@drcofcolorado.com and schambersyates@drcofcolorado.com
