Be prepared for your divorce

Over the years, I have found that divorce affects everyone – family, friends and even acquaintances of the divorcing couple. I view it as a ripple in a pond. When a stone is dropped in a pond, it doesn’t just sink, it creates a reaction. It starts as a small circle, but those ripples grow and spread, affecting an ever widening part of the pond.

I have had several friends walk this road. A few went through arbitration, because both parties agreed to the divorce and there was no arguing between them. However, most went the route of the divorce attorney and court because they could not or would not agree.
This is a very difficult road to walk down. Couples contemplating divorce frequently overlook the significant legal and financial implications of the event. This brings me to a question I received from a client who asked:

Q: “What do I need to do to protect myself because I think I may be headed for a divorce?  We have agreed to go to counseling first, but I am afraid of what will happen to me if we can’t make it work.” Signed Afraid.

A: Dear Afraid,
I am glad to see that you have agreed to see a counselor first. This shows that your marriage is important to both of you. However, it is important that you gather as much documentation as possible, so that information cannot mysteriously disappear, assets cannot be hidden and you will have few surprises (consult the list on this page to get you started). The emotional turmoil of a break-up that was commenced in joy causes many couples to be misinformed about the financial consequences. Here are some common myths:

  • Everything is automatically split 50/50
  • All assets are equal
  • Divorced women are better off financially than they were
  • Only divorce lawyers produce financial settlements
  • The wife should automatically get the house
  • My spouse will support me
  • My spouse will provide child support
  • The husband is obligated for education expenses

Remember, you need to rely on yourself and your individual support team when getting divorced. Do not rely on your soon-to-be ex-spouse to be nice or accommodating, especially if you’re both working with divorce attorneys. Divorce can be extremely adversarial. However, your soon-to-be ex may be cooperative and you may work together with your advisors to accomplish a positive plan and create some win-win benefits in this difficult situation.

If, on the other hand, cooperation is not possible, your time spent gathering and copying the information will be helpful when hard-nosed negotiation is the only alternative. Stated simply, the information you collect will help even the playing field and contribute in determining the outcome.

Lastly, if you, a member of your family or a close friend are contemplating divorce, consider talking with a financial advisor. The sobering aspects of the financial realities and repercussions might stimulate reconsideration. Re-member, divorce forces financial decisions that can affect the standard of living for all parties – for a long time.

By Laura Searles Stohlman, guest columnist and partner with Dan Searles and John Stohlman at Medallion Financial Group

Laura Searles Stohlman, Dan Searles and John Stohlman, owners of Medallion Financial Group, are all CFP®’s, financial planners and Registered Representatives with over 25 years each of experience in the financial services industry, offering securities and advisory services through National Planning Corporation (NPC), member FINRA/SIPC, a Registered Investment Adviser. Medallion Financial Group and NPC are separate and unrelated companies. They manage over $250 million of client assets. For further info, questions or comments regarding this article, Dan and John can be reached at 301-990-9704 or 1-800-878-9704 or