Key Relationships to Protect Your Assets and Peace of Mind
As financial advisors, we aim to simplify our clients’ lives. We often are asked for referrals, recommendations, and advice on how to approach life-changing events such as retirement, getting married, or entering a new chapter. Post- COVID, one of the more unfortunate changes we have seen is divorce, which includes a shift in family dynamics and thinking about two households. This can be a challenging time for anyone, even those who are astute at financial planning and have a handle on their personal financial picture. Feeling overwhelmed with emotion can cloud judgment and inhibit logical decision-making. With that in mind, we want to talk about the four key relationships to build during a divorce that will help ease the transition, personally and financially.
Family and Friends
Lean on the people close to you during this incredibly difficult time. It is important to have outlets inside and outside your personal circle.
Therapist or Coach
If you don’t have one already, find your own therapist outside of a marriage or couples counselor. Whether divorce is your decision or not, professional help will guide you through the steps to be sure this is what you truly want. It can also help eliminate uncertainty and regret so you can gift yourself a healthier new life. If you have younger children, consider a parenting coach. A coach can help you (and your co-parent) make decisions that suit your family best for the future. Your attorney can help with recommendations, as can school counselors and psychiatrists.
Wealth Management Team
It is common for households to effectively delegate financial responsibility to one party. As you gather important documents related to your investments, taxes, retirement, and estate planning, make a list of those you don’t have access to that are part of your household balance sheet. As you consult an attorney, they will require all documents from both parties, but this can help you get organized prior to your meeting. From a risk management perspective, this can also help you understand what you don’t know about your family’s financial picture. We suggest checking in with your financial advisor, portfolio manager, or tax consultant to obtain documents and critical information. As this is inevitably one of the most emotional experiences in your life, having a financial checklist will help move the ball forward. If you are struggling to gather your financial information, your most recent tax return contains a wealth of information about your income, expenses, investment accounts, etc.
In addition to gathering financial documents, it’s important to think about current expenses. Start to track what you have been spending as a married couple and think about what will change as you split into two households. Begin to think about what your future expenses might look like. Consider future childcare and educational expenses, debt and liability payments, inheritance, salary and bonus adjustments, elderly parent care, health insurance costs, and tax bills.
Family Law and Estate Planning Attorneys
For clients based in San Francisco, Seattle, and beyond there are various lists on the internet of top attorneys and questions to ask to make the right decision and find the best fit. However, the best “search” is often through your personal network. Begin by inquiring with those you feel comfortable with or someone who may have gone through a similar experience. It is valuable to share the experience with someone who can comfort you in knowing things will be okay, to keep pushing forward, and that there is light at the end of the tunnel. In addition to a family law attorney, you should also consider an estate planning attorney either during or once your divorce is final to help ensure your assets and real estate property are distributed according to your wishes. They can also help you update your trusts and/or wills.
Divorce is never easy but having a solid support team and key relationships will help you navigate this difficult time. Here at Columbia Pacific Wealth Management, we’re ready to listen. Please reach out to our team if you have any questions or to learn how we help clients through all phases of life.