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What You Need for Divorce Financial Negotiations

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Divorce financial settlement negotiations are no different than a traditional business negotiation. When both partners do their homework prior to their divorce financial negotiations and arrive well prepared the mediation will run more smoothly. Both parties will want to gather the following information.

1- A comprehensive monthly budget expense sheet of new (soon-to-be) living arrangements to include changes in utility expenses, medical insurance, medical co-pays, eye care, dental care, childcare, auto insurance, rental insurance/homeowner insurance, property tax, HOA fees, children’s extracurricular/sports activities, summer camps, clothes and school expenses, and any fees related to teen drivers (driver training, vehicle, insurance, gas) and estimate anticipated expenses for the children such as birthday/bat/bar mitzvah expenses, college and weddings

2- A comprehensive family net worth worksheet-a list of all tangible assets and their current value including all bank and financial accounts (investment portfolios, CD’s), retirement accounts, pensions, social security benefit statements and any Corporate matching savings/stock options from Employer, real estate, vehicles, boats and recreational equipment, itemized inventory of home furnishings and up-to-date reports of all credit cards and debts outstanding

Since insurance rates and policies will be changing it is important to get current quotes on separate policies and include these new figures in the monthly budget expense sheet.

3- A tentative parenting plan of how they envision shared custody of minor children.

Once all pertinent information is gathered, each partner should create their own priority assessment that notes:

  1. a) best case scenario;
  2. b) what I can live with;
  3. c) what I absolutely will not/cannot accept

regarding each major asset to be divided and proposed alimony and child support figures. When one prepares these thresholds in advance, they are very helpful to refer to during the mediation process when emotions may be heightened. It is also advisable to take the gathered information and worksheets to a Tax Accountant prior to mediation and seek advice on how best to handle alimony and child support expenses relating to tax implications. A tax certified CPA can advise how best to convert one household to two, minimize expenses and maximize tax benefits for both parties.

 

I recommend that the parties compile all of the above information into a 3-5 inch ring binder with tabs so they can easily refer to these during the mediation. This will save time and money (professional billable hour fees) for the partners and helps to reduce frustration during the mediation session.

 

When both parties have prepared in advance and determined their thresholds they bring with them the confidence to negotiate effectively. A sample of a monthly expense worksheet, family net worth worksheet, child custody agreement and a complete list of documents to gather as well as additional financial suggestions are available in the Transitions Divorce Prep Workbook ($23). http://amzn.to/1xfc9lV

 

Do you have additional comments regarding other things partners can do to prepare? If so, I would love to hear from you.

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More Information in Divorce Prep Workbook on Amazon: http://amzn.to/1xfc9lV

 

Disclosure of Material Connection: I have not received any compensation for writing this post. I am disclosing this in accordance with the Federal Trade Commission’s 16 CFR. Part 255: “Guides Concerning the Use of endorsements and Testimonials in Advertising.”

Disclaimer: This is my personal blog. The opinions I express here do not necessarily represent those of my organization, Transitions Resource, LLC. The information I provide is on an as-is basis. I make no representations as to accuracy, completeness, suitability, or validity of any information on this blog and will not be liable for any errors, omissions, or delays in this information or any losses, injuries, or damages arising from its use.

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