Contributed by: Jacki Roessler, CDFA®
Traditionally in Michigan, couples could approach divorce in two ways: through litigation or mediation. Both can be contentious and lead to further litigation post-divorce.
Although it has, for quite some time, had a foothold in other states, a new approach is steadily gaining momentum in Michigan: the Collaborative Divorce Process. Collaborative Divorce is a team approach in which both parties obtain legal counsel trained and certified in the Collaborative method. Other trained professionals, such as a mental health professionals and financial experts, can be added to the team. The goal of the Collaborative team, which of course includes both spouses, is to resolve all the parties’ issues outside of the court system in a way that is both transparent and fair.
The big question clients ask me is this: Does it work and is it right for every case?
As a divorce financial planner with nearly 25 years of experience, I have to admit that I greatly prefer the Collaborative Process. Does it work? Absolutely! Is it for every case? Maybe not. Read on to determine whether it might be worth exploring for you.
My role in a Collaborative Case is to act as a financial neutral for both parties. What does that look like? It generally incudes gathering and compiling all the financial data into simple spreadsheets everyone can understand. I put together a list of all the parties’ assets and liabilities and run a cash flow analysis for both to help determine each parties’ post-divorce living expenses. If one person has been primarily in charge of the finances, and the other one is in the dark, I will often meet with one or both spouses individually to educate them. This levels the playing field when it’s time to re-convene the team and discuss financial settlement options.
How is this different than a traditional case? There is transparency of information.
As a neutral, I receive all the financial data including account statements, tax returns, pension and employment information, budgets, etc. There is no tracking down of missing data or wondering whether all the assets have been captured. Not only does this eliminate stress for the least informed party, but it also saves on the legal fees that pile up when an attorney has to become a data detective.
After all the financial data is captured, compiled, and understood, the real team work can begin. We can be creative and arrive at financial solutions no one could even take the time to consider in a traditional divorce.
So, is it for everyone? It’s for everyone who wants to settle outside of court. If either of the parties attempts to hide or conceal information, the Collaborative Process probably will not work. It also is for couples who are willing to commit the time for team-to-team meetings and however many meetings are needed to come to resolution on all issues. Lastly, in my experience, Collaborative Divorce requires the parties to keep an open mind. When parties are entrenched in a position and will not budge, the Collaborative Process can become stalled.
If you think Collaborative Divorce might work for you, do some exploring! It always makes sense to look at all the options available when you’re making decisions that affect the rest of your life.
Jacki Roessler, CDFA®, is a Divorce Planner at Center for Financial Planning, Inc.® and Branch Associate, Raymond James Financial Services. With more than 25 years of experience in the field, she is a recognized leader in the area of Divorce Financial Planning.
Any opinions are those of author and not necessarily those of Raymond James. All opinions are as of this date and are subject to change without notice. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete.