Financial issues often emerge as flash points of conflict in separation agreements. Disputes about money can escalate quickly, and if you let them fester, can lead to prolonged court battles and exorbitant legal fees. Unfortunately, the traditional adversarial approach to resolving disputes can add to tension and prolong the process, leaving both parties emotionally and financially drained.
As a family mediator, I frequently advise my clients to enlist the help of a Certified Divorce Financial Analyst (CDFA). They specialize in navigating the intricate financial complexities common in family law cases. Unlike lawyers, who are each required to fight zealously for their client, CDFA's are neutrals, like mediators, who focus on achieving an equitable outcome for both parties. Their hourly rates are almost always lower than lawyers, and are split equally between each client.
Here are just some of the items a CDFA can help with:
· Child support obligations
· Spousal support entitlements
· Valuation of the home and other investments
· Division of workplace pensions
· Tax implications when RRSPs or pensions are transferred
· Treatment options regarding inheritance & family gifts
· Status of assets brought into the relationship
· And many, many more
In all separation agreements, both parties are required to disclose all assets, liabilities, and financial obligations, but they may not trust one another’s disclosures, let alone agree on how to divide them. Without a foundation of trusted facts, disputes over child support, spousal support, and property division can linger unresolved, prolonging the separation process – and the fees - indefinitely. One of the most compelling reasons to engage a CDFA is their ability to determine who owns and owes what amount, according to law. They accomplish this by gathering evidence of each party’s assets and liabilities and entering that information into specially designed spreadsheets and calculators to determine each person’s entitlements and obligations.
All of this is not to suggest that the CDFA is always a one stop guarantee. Depending on your level of conflict and the complexity of your finances, other financial experts can sometimes be required as requested by the CDFA or either of the lawyers. This could include
· Business valuator
· Estate lawyer
· Insurance advisor
· Forensic accountant
· Real estate appraiser
· Pension Specialist
· Tax advisor
In addition to the number crunching, since they are neutral and objective, CDFA's foster an environment of collaboration and cooperation, minimizing conflict and reducing overall expenses. They save time and money in the short term, and by ensuring your separation agreement is accurate and enforceable, their benefits last well into the future.
Ultimately, the decision to enlist the services of a CDFA is an investment in clarity, fairness, and peace of mind. By prioritizing precision and collaboration in resolving financial matters, couples can streamline the separation process and mitigate the emotional and financial toll often associated with divorce proceedings.
ABOUT THE AUTHOR
Mike MacConnell, founder of Reflective Mediation, is an accredited family mediator, conflict coach, educator and author. He is the highest-ranked mediator on Google in the greater Toronto area, with over 180 5-star reviews. To book your free consultation click here.
