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Tracy Stewart, CPA

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Peace of mind through financial clarity.

How much will this divorce cost?

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I hear questions from people who come to me for divorce financial advice. No matter whether we are talking about College Station or Houston, the answer is always “it depends.”

It depends upon which divorce process you choose. Do it yourself, litigation, mediation or collaborative. Even the do it yourself can be expensive if you are not fully aware of the complexities of your financial situation. Don’t be like most people. Don’t assume your situation is simple.

It depends upon how cooperative you and your spouse are going to be with each other. Will you compromise quickly? Will you fight over the vacation souvenirs? (Yes, I saw that happen.)

It depends upon whether you are counting the future hidden costs of incomplete information. Don’t be focused only on the present. Look ahead at the possible financial gotchas that will bite you if you shortcut your divorce. Hire competent professionals: attorney, divorce CPA and child specialist.

It depends upon whether you hire the cheapest or the most expensive attorney. Don’t do either. Hire an attorney with average hourly rates. Ask other professionals for recommendations. Your friends and colleagues will give you names, but that doesn’t mean their favorite is the right fit for you.

It depends upon how organized you are. The more organized, the more you can save on fees.

Divorce: Watching Out for Your Financial Future

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Bryan/College Station couples in divorce who stay out of court can get ahead financially by choosing the collaborative law divorce process. Unlike all the other divorce processes, collaborative law divorce provides a neutral financial advisor who has particular experience in helping couples move from we to me. You can save divorce costs and have a new financial plan that gets you going in your new life.

Divorce is one of the most stressful transitions you can face. Most individuals just want out, no matter what the cost. Unfortunately, without divorce financial advice, the cost can be very steep indeed. It can include decades of fighting in court and difficultly making ends meet. The usual financial planning structure does not work in divorce.

Your financial considerations hinge on the fact that you are moving from a couple to a couple of individuals. You and your spouse may have always differed in your financial planning opinions, but you had to compromise in some way during your marriage. After the divorce, each of you can make your own choices. This transition in planning is unique to divorce.

In a Bryan/College Station collaborative law divorce, you work with a team of experts trained by the Collaborative Law Institute of Texas. This includes attorneys for both sides, a neutral CPA/financial planner and a neutral divorce coach/child specialist. The neutral CPA develops a plan for splitting your property and is prohibited from taking either of you as a client after the divorce.

In mediation, you usually only have your attorney to advise you, missing the financial expertise of the collaborative law process. If a financial planner is engaged for a mediated divorce, that person can accept either party as a client after the divorce. This is a financial risk to you if your spouse promises to be a paying client after the divorce. Only the collaborative process ensures the protections of a truly neutral financial advisor.

 

I have worked on about 100 collaborative law divorces. If you would like my advice on which collaborative law attorneys to interview, feel free to contact me at stewart@texasdivorcecpa.com.

Get a Jump on Your Divorce

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Looking at a divorce? Get a jump on your case. Save legal fees. Get to settlement sooner. Stop the pain faster.

Make your first step learning about your property settlement options.

Litigation divorce cases in Brazos County move at glacial speed. If you want to end your pain sooner, get a handle on your settlement options before you file and before you seek an attorney. The first thing to do is to meet with a CPA experienced in divorce settlements.

Why shouldn’t you consult with your tax CPA or your investment advisor? Sure, these experts are talented in their own niches. But they don’t have specialized knowledge and experience of working with divorce attorneys through to a wide variety of divorce property settlements. You need a specialist to identify the long-term financial implications from your decisions that will affect your happiness for the long haul. You need a specialist to get you up to speed quickly.

The divorce CPA will walk you through the minefield, showing you where to step and when to jump aside.  He or she will explain the pros and cons of your various settlement options. For example, are you thinking of owning the house together with your ex after the divorce? There are dozens of details that can go wrong. There are income tax implications to avoid or take advantage of. If you don’t address all those issues, they can pop up later to sideline your long-term and short-term financial goals.

How will this save you money?  When you understand your financial options before your attorney does, you are way ahead in the process. You are closer to ending your pain. You will save time and money when you can interview attorneys with the summary and details of your various settlement options in your hand.

When you are ready to look for a divorce attorney in the Brazos County, contact me. I can help you find the divorce attorney who best fits your situation.

Be Brief: Reduce Divorce Costs

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Whether in Houston or College Station, clients everywhere want to keep their divorce costs down. I encourage my clients to spend wisely but not too generously on their divorce. I want them to have a divorce that sticks but also have money left over to fund their own retirement. There are some easy ways to keep your costs down. All you have to do is keep your focus.

Focus on what you want to accomplish every time you contact your lawyer. Attorneys charge for their time. That includes time to read and reply to emails. Include only the essential information in your emails. I recommend that you ask no more than two questions in an email. Isolate each question with some white space around it. Consider numbering them: “Question 1 …. Question 2.” Make it easy for your attorney to see your questions because that will make it easier and faster to answer them. This saves you money.

Do not vent or ramble. This is true in emails, phone calls and face-to-face meetings. Of course you are in emotional turmoil, but your attorney is not your therapist. So focus on business. Save your emotional outbursts for your sympathetic friends or your therapist’s couch.

For phone calls and meetings, have a list of your questions with the most important questions at the top. If your meeting or call ends before you get through all your questions, at least you will have addressed the most important ones.

If you are looking for a divorce attorney in the Brazos Valley, contact me. I can help you find the divorce attorney that best fits your situation.

The Secret of Finding the Best Divorce Attorney in Brazos County

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The best divorce attorney is the one who best fits you and your divorce issues. Don’t think this would be your friend’s divorce attorney. Nor the attorney with the biggest caseload. Nor the biggest law firm.  The optimal attorney for you will be the one who has experience with your issues, communicates well and shares your priorities.

No one has exactly your divorce. It only takes one small condition to make your situation significantly different that of someone else’s divorce. You need to find the attorney with experience in your particular issues. If you own rental real estate, you need an attorney with experience in negotiating effective settlements involving rental units. If you are not sure how to proceed with your case, you need an attorney who can offer you choices – one who is great in the courtroom, an effective negotiator and is trained in collaborative law.

Communicating well means communicating easily with you. Are you comfortable with emails? Would you like an attorney who prefers phone calls? What are your needs for speedy replies from your attorney? I had a client who resorted to sending her local attorney a certified letter just to get his attention.

Know what is important to you. Do you want to save money? Then I recommend you seek an attorney whose style includes welcoming your do-it-yourself assistance. Do you want to have a cordial co-parenting relationship with your ex? Then I recommend you seek an attorney with collaborative law training. What are your priorities?

If you are looking for the right divorce attorney in Brazos County, send me an email to stewart@TexasDivorceCPA.com. Let’s take a few minutes to talk about your situation, needs and priorities. I can refer you to the local divorce attorney with the best fit for you.

Divorce Mediation: Learn from the Boy Scouts

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To increase your odds of getting what you want in mediation, take a tip from the Boys Scouts: Be Prepared. Most of my Brazos County divorces include mediation. When you are prepared, you have a better chance of a successful outcome.

Develop a realistic settlement range. At the low end, know what your worst-case settlement looks like. At the high end, what is your dream settlement? Calculate your break-even point. These steps will prepare you to respond to various proposals that will come from your spouse during the mediation.

Identify what is essential to discuss at mediation. Make a list. Review it with your lawyer a few weeks before the mediation. The issues don’t have to be financial. One of my clients had a strong emotional issue regarding the old videotapes of her daughter’s early childhood. The mediation did not end until she and her husband resolved the issues surrounding those tapes.

Bring your starting offer. If you initiated the divorce, come to mediation with a written offer. Get the settlement discussions started right away. Your starting offer should not be your bottom line settlement scenario. Consult with your lawyer to pull this initial offer from somewhere within your realistic settlement range.

If you are getting a divorce in Brazos County or nearby counties, I can refer you to excellent divorce lawyers and mediators.

Separating from your Spouse… and your CPA?

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In the divorce process, it is likely that you will face unintended tax consequences in your settlement options. Brazos County divorce attorneys are not always aware of many of these tax issues. A CPA can identify these divorce tax traps that can pop up after your divorce.

When your tax CPA has represented both you and your spouse in the past (such as preparing a joint tax return or giving estate planning advice) but now provides divorce advice to only one of you, one kind of conflict of interest arises. A second kind of conflict arises when your CPA has attempted to give you both generic marital property advice early in your divorce. For example, while attempting to help you both in the divorce, your CPA recommends a basic division of property. Your CPA has used preliminary values for your property. Later, it turns out that the values used to calculate the final division are substantially different. This can result in very different property split and it appears that your CPA has acted in the interests of one of you over the other. Conflicts bring liability risks for CPAs.

Your risk is that your CPA doesn’t think about the liability risk and kindly starts giving financial advice that turns out to favor your spouse. Whether the advice is for both of you or just one of you, the result could unintentionally cause lopsided financial effects for you.

Many times, CPAs would rather not get involved in divorce issues. Those CPAs prefer to avoid giving financial advice until after the divorce is final. Fortunately for these clients, there are CPAs out there who are willing to guide clients through the financial maze of divorce.

Brazos County divorce lawyer, Randy Michel, explains that a judge may consider the income tax implications in considering what a “just and right” property division would be. However, that does not mean the judge will ask questions on his/her own or drill down deeply unless your attorney can and will educate the judge as to the applicable tax implications.

If your divorce lawyer is not also a CPA, educating the judge could be a challenge. A CPA with experience in divorce cases can identify those unforeseen financial and tax issues and educate your attorney and your judge.

If you think you could benefit from this kind of advice, let me know. I can also refer you to a Brazos County divorce lawyer.

Broken Agreements in Broken Marriages

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Sometimes my College Station divorce clients come to the collaborative case with pre-existing spousal agreements. I am the neutral financial CPA on these cases. That means I am not an attorney and I don’t know the ins and outs of what attorneys do. But I have heard attorneys imply that these agreements don’t survive the entrance to a legal case. (Perhaps those were said by the attorney for the spouse who doesn’t like the agreement.)

By agreements, I am talking about things ranging from promises to give him/her the landscape painting to promises for support payments for “all” his/her living expenses.

If you have any pre-attorney agreements with your spouse, check with your attorney in your first meeting. Be clear about the agreements and what you think both you and your spouse said at the time. Be clear about your current intentions.

  • How will this be handled in my divorce case?
  • I didn’t agree to this, I just kept my mouth shut and now he/she is forcing this on me.
  • He/she promised to pay alimony for life. Can I really get that?
  • Can he/she really get credit for giving me something now that he/she already gave me as a gift years ago?
  • Is this agreement wiped out because we now have attorneys involved?
  • Can I make him/her honor this agreement now that we have started the legal part of this divorce?

In collaborative divorce cases there is a method to talk nicely about these expectations. I have been involved in these discussions dozens of times. It is best to get this resolved up front. Don’t hide from these issues. If you want to keep your costs down and get out as quickly as you can, be assertive about clearing the air on these old agreements.

I would like to hear about any broken agreements that you have experienced in divorce.

How to Avoid Surprise Divorce Attorney Costs

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My colleague, Faith Wilson, MA, LPC (Licensed Professional Counselor) is a therapist who sees a ton of people who are thinking about divorce. Faith covers the emotional struggle while I cover the divorce financial advice. We both work in Houston and Bryan / College Station.

Faith’s clients ask her for names of divorce attorneys. She only gives them names of attorneys she knows and trusts. She explains that divorce costs depend upon the individual circumstances and there is no way to predict the eventual cost.  So, what do some of these clients do? They ignore her advice and go out and hire the cheapest attorney they can find.

In their next therapy session, they tell Faith, “Hey! I found a divorce lawyer who says it’s only going to cost me $1,500.” Seems these clients paid a $1,500 retainer and either weren’t listening closely enough to the divorce attorney or were told that their initial retainer will cover the entire divorce cost.

Fast-forward some months. In their therapy session they complain to Faith, “Hey! My divorce lawyer says I have to pay more money!” Surprise. Surprise.

Don’t ever think that your initial retainer will cover the entire cost of your divorce. If it does, you are reeeeally lucky or you paid a huge retainer.

What to do?  Interview two or three divorce lawyers before hiring one. Listen carefully to the divorce attorney you are interviewing. Ask what the total fees will be.  The honest answer is, “it depends.” Then ask about typical things that will cost you to have to pay more during your divorce. Find out what situations or actions might cause these things to happen.

Seek out attorneys who will clearly explain how divorce attorney fees work. Read their website and ask questions.  This is one of the first opportunities you will have in your divorce process to expand your financial knowledge.