![]() ![]() What is the CDFA® (Certified Divorce Financial Analyst®) Professional's Role? Solid information and expert analysis are important resources in their search for the best possible resolutions for their clients.įortunately, with CDFA professionals, help is on the way. This is why more and more lawyers have seen the virtue of bringing a financial expert into the divorce process at the very start. Additionally, even if lawyers happen to have accumulated a degree of financial expertise, they are not allowed to testify on behalf of their clients in court. Lawyers attend law school to become experts in the law, not to become financial experts. Many lawyers struggle with the intricate financial details that concern tax issues, CRA rulings, capital gains, dividing pensions, and so on. These are the questions that divorce lawyers face with each divorce case. What happens if a paying ex-spouse dies?.What additional financial support does that person need?.How will the lower-earning spouse survive financially?.How do we divide retirement funds and pensions?.What tax issues must we be concerned with?.Who will pay for their education and medical treatment?.Many divorcing couples have questions such as: If a couple cannot solve their financial difficulties while the marriage was underway, it is unlikely that they will be able to agree on pressing financial issues when it has fallen apart. These questions are often clouded by wounded emotions and accompanied by mutual accusations, which comes as no surprise. Once a decision to separate or divorce has been reached, all sorts of questions bubble to the surface. Typically a financial advisor – whether it is a CPA, CFP®, or a CDFA® – is not considered until later in the divorce process – or even until after the divorce is final.įinancial problems can tear a marriage apart, and are often the primary factor that leads to divorce. Who do people turn to for such assistance? When people think about getting a divorce, the first professional that comes to mind is an attorney. This parable has an unfortunate ending, but pre-divorce financial counseling can help people going through a divorce arrive at a settlement that is fully understood by all involved. Had David met with a CDFA® (Certified Divorce Financial Analyst®) before the divorce was finalized, he would have been in a better position to ask for a more equitable settlement. His 50/50 split cost him an additional $18,000 in taxes. His ex-wife, on the other hand, could access her half of the assets tax-free. They didn’t realize that David would have to pay taxes on his half of the assets when he tried to access them. Unfortunately, there was something he neither knew nor understood neither did his lawyer, and neither did the judge. Is that OK?” David answered, “Well, I guess that sounds pretty fair. You take this half of the assets and I will take that half. She chose all the investments, made all the decisions, and invested all the money.Īt the time of their divorce she said, “Let’s just split everything 50/50. During the planning session, it became apparent that during his marriage his wife had done all of the investing. Together, David and his planner decided to do a total financial plan for him. The role of the CDFA® (Certified Divorce Financial Analyst®) professional is to assist the client and his/her lawyer to understand how the financial decisions he/she makes today will impact the client’s financial future.Īfter his divorce, David went to a financial advisor to determine how to best position his assets. ![]()
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