Survey: Separated People now Contacting CDFA® Professionals before Lawyers

Ed Kerns |

People at the beginning of the divorce process now recognize that the financial issues they’re facing are as important as the legal ones—and many of them are now seeking financial advice about their situation before they enter a lawyer’s office.

People at the beginning of the divorce process now recognize that the financial issues they’re facing are as important as the legal ones—and many of them are now seeking financial advice about their situation before they enter a lawyer’s office. In fact, 89% of the 193 CDFA professionals from across North America who responded to a survey con- ducted in August, 2013 stated that they had been approached by a potential cli-

ent before they had hired a lawyer. “About 40% of my clients come to me first,” confirms Barbara Shapiro, a Certified Divorce Financial Analyst® professional who has been prac- ticing in the Boston, MA area since 1998.

When clients ask whether they really need to hire a lawyer as well as a CDFA profes- sional, Shapiro explains the different—but complementary—roles played by each profes- sional. “I tell them that as important as the financial settlement is, it is really only one piece of the puzzle,” she says. “The lawyer’s job is to look at the entire situation and advocate for and explain to the client their respective rights and obligations.”

“It is definitely advantageous to hire a CDFA professional first,” asserts Seth Kaplan, an experienced CDFA professional practicing in the Sacramento, CA area. “We can educate the client on various financial considerations, provide an overview regarding their options for getting divorced (i.e., litigation, mediation, collaborative), and help them organize their required financial materials and documents, which will help contain the

cost of the process.” Before he makes referrals to local lawyers, Kaplan talks to clients to gain an understanding of their primary issues and details about their financial situation. “For instance, I need to know whether they own a business, whether there are minor children, what their primary objectives are, whether they have preferences regarding having a male or female lawyer, and/or other preferences they may have—such as per- sonality types.”

Shapiro takes a similar approach with her clients, learning what’s important to them and telling them about their options for resolving their issues. “After  they decide which   model suits their needs and preferences best, I refer them to at least three lawyers who practice in that model—and who understand the value a CDFA professionals brings to the process. I tell my clients it’s like picking a doctor: they’re all well-qualified, but some you’re comfortable with, and some you aren’t.” She adds that if a client has chosen a law- yer she doesn’t know, she offers to speak with them to create a productive working rela- tionship—and to reassure them that she isn’t going to tread on their turf. “I stress that     the lawyer is the captain of the ship in terms of legal strategy. I’m here to support them  and the client with key financial data—not to dictate how the case should proceed,” she adds.

Money is a huge source of uncertainty and fear-based arguments in many divorces; a CDFA professional can allay some of the fears by helping clients avoid financial pitfalls, watching out for tax issues, and letting clients know what their financial future will look like if they accept “Settlement A” or “Settlement B”. When clients feel more secure, they’re able to make better choices about their futures.

If marriage is all about love, then divorce is all about money. “And when people are going through a divorce, they must keep their focus on the money,” says Jeffrey A. Landers, a CDFA professional based in New York, NY. The author of Divorce: Think Financially, Not Emotionally (Sourced Media Books, 2012), Landers adds that divorces are now much more financially complicated than they were just 10 or 15 years ago. “Today, it’s not unu- sual for marital assets to include residential and commercial real estate, sophisticated financial investments, complex employee compensation packages, and closely-held busi- nesses or professional practices,” he says. “Finances, financial projections and analyses aren’t taught in law school—and good divorce lawyers understand they don’t have the expertise and/or the time to handle the financial complexities of their clients’ cases.” This means that more and more divorce lawyers are now encouraging their clients to hire a skilled CDFA professional to assist in their case.

“If a divorcing person hopes to lock in a secure financial future for themselves and their children, then it is vitally important to have a divorce financial advisor on their team,” asserts Landers. “And not just any financial advisor: they need one with the training and experience to handle their specific set of circumstances.”

Reprinted with permission from Institute for Divorce Financial Analysts™.  By IDFA 10/17/2013