If you are uncertain about the financial aspects of your divorce, you may want to seek the help of a Certified Divorce Financial Analyst (CDFA™).
What is a CDFA™?
A Certified Divorce Financial Analyst (CDFA) can work with you to project the financial implications of your divorce, while your attorney focuses on the legal issues. Setting a realistic budget and understanding the tax and investment details before your divorce is finalized will allow you to start off on the right foot financially.
Certified Divorce Financial Analysts (CDFA™s) have specialized training to work with divorcing spouses to reach equitable divorce settlements. Applicants for the CDFA™ designation must also have a recognized financial planning or accounting designation to qualify for the training. CDFA™s are governed by the Institute for Divorce Financial Analysts Code of Ethics and Professional Responsibility.
A CDFA™ reviews the financial issues, considers the division of assets, and projects the short-term and long-term financial impact of a proposed divorce settlement. A divorce financial professional will use specialized software to gather and analyze your financial data, including property, assets, incomes, expenses, pensions, tax issues, spousal and child support, inflation, cost of living, life insurance, health insurance, and retirement.
Why Work with a CDFA™?
Working with a Certified Divorce Financial Analyst may save you time and money. The midst of a divorce is not the best time to spend a lot of time learning new financial concepts and terminology. A CDFA™ can explain the financial aspects of the process, empowering you to make educated decisions. Your attorney’s area of expertise is the law, rather than financial issues such as budgets, insurance or planning for retirement. (Your attorney may also be more expensive on an hourly basis.)
But the more important reason is to help achieve better outcomes and fewer financial regrets from the divorce process. Divorce settlements can have unintended financial consequences, and a financial specialist can help identify them ahead of time, so there are fewer financial surprises during and after the divorce. This in turn can help reduce post-divorce struggles, especially relating to household budgets, and generally reduce the amount of stress and misunderstanding in the process. Property separation, retirement considerations, spousal maintenance, and child support all have tax implications which should be taken into consideration.
How Can a Certified Divorce Financial Analyst Help?
Here are some of the questions an experienced CDFA™ may help answer:
- Is my estimated budget realistic?
- Can I afford to keep the house? What will it cost to buy out my spouse?
- How will spousal support affect my taxes? What about child support?
- Who should take the tax deduction for our kids?
- What is the current value of my future expected pension?
- How can we divide a retirement plan?
- Can unvested stock options be part of my divorce settlement?
- Which of two settlement proposals is best for me financially, in the long term?
If you are experiencing uncertainty about the financial aspects of your divorce, you may want to seek the help of a Certified Divorce Financial Analyst (CDFA™). Schedule a free consultation.
Your attorney or mediator may also be able to recommend someone, or you can find one at the Institute for Divorce Financial Analysts website.