Divorce can be a time of unpleasant conversations, turmoil, and arguments. If you are daydreaming about packing a bag and leaving this mess behind for a few weeks, you are not alone. In fact, many couples choose to separate before divorce. For those who have the financial means to do it, this might mean that one of the spouses moves out of the family home to live elsewhere. There are definite benefits to the moving-out decision. Separate living arrangements can give each spouse a haven to … [Read more...]
About Tracy Stewart, CPA
Financial Planning for Post Divorce
Divorce is an uncomfortable time for most couples. Even if you are going through the divorce using a collaborative approach, you probably don’t know what to expect from the split – which can be nerve-wracking. If you are anxious about your first meeting with the neutral financial planner, here’s what you need to know to arrive well-prepared and confident. Solo or together? Before your head into that first meeting with the neutral financial planner, think about whether you want to attend the … [Read more...]
Ask Your Financial Planner: How Should We Transfer an IRA in a Divorce?
Many couples make the mistake of assuming that IRA balance transfers in a divorce are easy – just because they don’t require a Qualified Domestic Relations Order or QDRO. It is true that IRA transfers can be done smoothly and without tax consequences to either spouse, but that outcome requires advance planning and careful execution. Here is what you need to know. IRA transfers in a divorce are referred to as a “transfer incident to divorce” to distinguish them from the transfer of qualified … [Read more...]
3 Smart Steps to Protect Your Finances in a Grey Divorce
Did you know divorce came in different colors? Puns aside, “grey” or late-life divorce has become a considerable enough trend to warrant its own category. Every couple’s circumstances are unique: some have grown kids, others are childless; some have built up a considerable next egg while others live paycheck to paycheck. What unites them all is a decision to untangle a family life in their 50’s. Sociologists argue whether this trend is caused by increasing life expectancies, a wider acceptance … [Read more...]
Managing your Emotions When it Comes to Money
What are some of the most common emotions surrounding money? Most of us equate an abundance of money with financial stability, peace of mind and freedom. It is no wonder that a threat or possibility of financial loss can push us into depression and panic. Fear, shame and anger also make the short list. The emotional nature of our relationship with money is particularly obvious at the divorce negotiation table. The normal vortex of divorce emotions (loss, grief, a sense of betrayal) is … [Read more...]
When Your Spouse is not Playing Fair: Forensics in Divorce
Divorce is hard enough when everyone cooperates. But what should you do if you suspect that your spouse may not be playing fair? Some might hide money under the proverbial mattress (or inside an air duct), others may create a fictitious company to funnel funds to – all in an effort to underplay their net worth, give up fewer assets or pay less in children’s expenses. This is a difficult situation indeed. All you may have in the beginning is a few facts that aren’t adding up, or continuous … [Read more...]
Splitting Retirement Assets – Don’t Try This at Home!
Some things are meant to be shared, not divided. That statement is particularly true of retirement assets. 401(k)’s, IRAs and pension plans are notoriously difficult to split. Add in tax consequences and conflicting advice you might be getting from your family, neighbors, attorneys and the Internet, and you have a financial disaster in the making. Here is what you need to know to make good decisions. 1. Retirement funds added during the marriage are typically considered marital … [Read more...]
New Concerns Regarding Health Insurance Coverage
This post is from Tracy Stewart, CPA, PFS, CFF, CFP, CDFA, a College Station and Houston-based financial planner and Collaborative Law Institute of Texas board member. In many households, health insurance is covered with a policy that is tied to one of the spouses. If the other spouse is a homemaker, or employed where no health insurance is provided, that spouse needs to find replacement health insurance. Prior to the Patient Protection and Affordable Care Act (the Healthcare Reform Bill), … [Read more...]
