This week, I’m happy to share a guest post from Bart Zandbergen, CFP®, CDFA®. Bart is a Senior Wealth Advisor at Optivest Wealth Management and has some great wisdom to share about the role a Certified Divorce Financial Analyst® can play in your divorce. Enjoy!
It’s widely documented that the number one issue that couples fight about is money. When it comes to relationships, money is a hot button; a recent survey by Ramsey Solutions found that fighting over money is the second leading cause of divorce, right behind infidelity.
When it comes to divorce in California, separation of financial assets can be one of the most complicated parts of the divorce process. In this article, we’re going to talk about how a Certified Divorce Financial Analyst® (CDFA®) can make your divorce less stressful, and whether you should hire one.
What is a Certified Divorce Financial Analyst®
During a divorce, the role of the CDFA® is to help both the client and their lawyer understand how the financial decisions they are making will impact the client’s financial future. A CDFA® is trained and knowledgeable about your state’s divorce laws as well as personal financial planning. Working with a financial divorce expert helps allay financial fears because we can help preserve a family’s finances and ensure a fair, equitable settlement.
Most of the time, a CDFA® is someone who comes from a financial planning background, like me. In addition to my role as a CDFA®, I am also a Certified Financial Planner™ and a Senior Wealth Advisor at Optivest Wealth Management. Becoming a CDFA® requires completing an intensive training program to gain expertise in analyzing and providing expertise related to the financial issues of divorce.
Who Should Hire a Certified Divorce Financial Analyst®?
If you are a business owner or have significant property and/or assets, you would benefit from hiring a certified divorce financial analyst. Critical pieces to determining your divorce settlement will be:
- Valuing assets and debts
- Valuing your marital home and any additional properties
- Dividing all retirement and pension accounts
- Determining the amount and duration of alimony
- Tax implications of alimony and property division
Benefits of using a Certified Divorce Financial Analyst
As a Certified Divorce Financial Analyst®, I become a part of your divorce team and work closely with your lawyer. Here are some of the ways that I can help:
- Build a complete and accurate picture of your family’s financial dynamic
- Run models to show the effects of taxes and inflation to determine the best settlement
- Prepare forecasts to test the proposed settlement options that can serve as a foundation for future investment decisions
- Provide insight into how long your money should last
- Help set expectations and provide clarity for your financial future and the type of lifestyle you can afford going forward
- Provide clarity and help you understand the short- and long-term financial consequences of settlement options
- Help your lawyer strategize and build creative options to complicated settlement issues
Involving a CDFA® early in the divorce process to help evaluate different settlement and support scenarios can save you valuable time and money. In addition, we can be instrumental in modeling projected rates of return on invested assets, which is information that allows you to make informed decisions on how much and what types of property you may wish to receive in a settlement as well as the amount and duration of support that’s appropriate in their case.
Your divorce settlement will have a critical, long-term impact on your financial future. Including a CDFA® as part of your divorce team to prepare a thorough analysis of your finances and future needs will help prevent you from agreeing to a settlement you’ll later regret.