Divorce Financial Planning FAQS

Get the Best Financial Planning Advice That Covers All Aspects Of Your Divorce Financing needs with Empowered Divorce Solutions.

How can a Certified Divorce Financial Analyst™ (CDFA™) or Chartered Financial Divorce Specialist (CFDS) help me?

The financial decisions that you make as part of your divorce are likely to be the most important financial decisions of your lifetime. A Certified Divorce Financial Analyst™ (CDFA™) or Chartered Divorce Financial Specialist (CFDS) can guide you through these stressful and complex financial issues to reach a solution that works for you.

Planning for the future is an essential part of every divorce and fundamental to financial planning. Settlements that look fair initially often become unworkable over time due to changes in income, taxes, maintenance and child support. CDFAs™ utilize divorce-planning software to produce 10 and 15 year projections of clients’ finances. Long term analyses are necessary to check on the viability of a settlement and answer questions such as can you afford to keep the marital residence, should you give up your share of your spouse’s pension and what post-divorce lifestyle can you expect.

How is a Certified Divorce Financial Analyst™ or Charted Financial Divorce Specialist (CFDS) different from a Certified Financial Planner® (CFP®)?

A CFP® professional must take extensive exams in the areas of financial planning, taxes, insurance, estate planning and retirement. The right to use the marks CFP® is granted under license by Financial Planners Standards Council (FPSC) to those persons who have met its educational standards, passed the FPSC's Certified Financial Planner Examination, satisfied a work experience requirement, and agreed to abide by FPSC Code of Ethics.

The Institute for Divorce Financial Analysts (IDFA) provides specialized training to accounting, financial, and legal professionals in the field of divorce financial planning. Over the years, more than 5,000 professionals in the US and Canada have been certified as Certified Divorce Financial Analyst™ (CDFA™) professionals.

The IDFA provides comprehensive training using a variety of knowledge and skill-building techniques. CDFA™ candidates learn how to help their divorcing clients with financial issues that will affect the rest of their lives. To acquire the designation, a candidate must successfully pass all exams and be in good standing with their licensing or regulatory agencies.

As a member of your divorce team early on, a CDFA™ can help prepare statements of marital assets and liabilities, develop accurate budgets (historical and post-separation), evaluate settlement proposal(s), minimize post-divorce taxes, be your financial coach and testify as an expert witness on issues related to lifestyle and personal finance. Through this venue, a CDFA™ can enhance the productivity of your family law lawyer and boost your understanding of financial issues.

My divorce is amicable, I don’t see how a CDFA™ or CFDS can help.

Even if your divorce is amicable, your spouse may have retained a highly qualified lawyer and a financial advisor. You deserve the very best financial advice to ensure that you receive a fair and equitable settlement. We strive to meet every challenge as we guide you through the divorce process and help you plan for the future. With Empowered Divorce Solutions on your side, you will receive professional financial planning, tax, and asset management advice.

What are the typical issues?

  • Spousal support vs. child support. Spousal Support is tax-deducted by the payer and taxable to the recipient, whereas child support is neither.
  • Whether to sell or keep the marital home.
  • How to divide retirement assets while keeping long term life goals in mind.

Whom do you work for?

We can be hired by a lawyer, mediator or by the client. But we always work with the lawyer or mediator, no matter who hires me.

Whose side are you on in a divorce?

If you are our client, we are on your side, part of your team. We work for either party. It's not "How can I get that man or woman". It's about dividing property equitably so that both parties can get on with their lives.

Why not just have the lawyer do it?

Lawyers are not necessarily trained to handle the present and future financial complexities. We are a support to the lawyer.

What is the biggest financial challenge that is typically faced by couples going through divorce?

Unequal knowledge and understanding of financial issues. Significantly greater knowledge of finances by one partner puts the other person at a disadvantage. It is important that the financially less knowledgeable partner has help getting up to speed.

What is the most prevalent danger of not planning the financial split in divorce?

  • Taxes. Someone who has not done adequate divorce planning may find surprises at the other end. If it's done properly, taxes cannot be eliminated but they can be mitigated.

Another danger is gaining control of an asset that you cannot support.