Negotiating your divorce is never going to be easy, but the ‘collaborative’ approach to settlement can be quicker and less costly than you might expect. This approach prioritises the early provision of expert financial assessment and advice, which makes it significantly different to traditional combative and litigious proceedings.
Collaborative settlement is gaining momentum in family law and is proving to be a much cheaper option for divorcing couples, especially where the asset pool is not substantial. Here’s a summary of the benefits of this approach and how it can help you make the best of a difficult situation.
The major finding from a series of recent interviews conducted by Collins Mann with family law experts and divorced clients was that few divorcing couples are receiving good financial advice.
Many clients don’t understand that the long-term effects of their financial settlement can cause significant financial difficulties for both parties. Instead of asking themselves the most important question – How am I going to survive financially for the next five or ten years regardless of the outcome of the settlement? They tend to focus on the present and the extra few dollars here and there that they might be able to ‘win’ from their former partner. As a result, they tend to neglect working out the most effective financial strategy for their future.
What is needed …
There is a need for financial planning advice to occur much earlier in the divorce process than it usually does. Financial settlement also needs to be dealt with differently than it is now where each party receives a cheque for their share of the asset pool (after legal costs) and is provided with a couple of names of financial planners to seek advice from. In our view, financial advice at this point in the process is simply too little, too late.
Collaboration – aim, approach, outcome
In any divorce situation, the two main areas for consideration are child access and financial settlement. At Collins Mann, we specialise in the latter and offer financial clarity as the basis for divorce proceedings, rather than something that follows settlement.
I am a financial advisor and not a legal professional. Nevertheless, we specialise in and are qualified in providing financial advice to divorcing parties and family lawyers from the very outset. This new approach addresses the financial implications up front and has numerous benefits, not least of which is avoiding the erosion of your asset base on unnecessary legal fees. Both parties, however, need to adopt a collaborative approach to their separation.
We assist collaborative parties by project managing the divorce process:
- The aim of our divorce settlement service is to help you to be realistic about your financial settlement through being informed about its financial implications.
- Our collaborative approach differs from the tradition approach to divorce that is normally dominated by strictly legal processes. The legal process is not only expensive (or extremely expensive) but it also doesn’t give enough attention to the financial implications for each party. We reverse the process and address the financial ‘argy bargy’ up front before the legal system gets involved.
- The outcome of our collaborative approach usually sees a divorce settlement that is quicker and considerably less expensive than you might expect. This allows the parties to be far better off financially and able to move on with their lives sooner.
A comprehensive and useful process
Our unique approach provides a comprehensive and impartial financial assessment of possible settlement scenarios for you to consider, made in the context of your overall financial situation. We project manage your divorce process by assisting and providing both parties with:
- Impartial guidance as to the likely settlement outcome that is advantageous for both parties. We use our network of family lawyers and our experience to identify the likely financial parameters of each case so that both parties are clear as to the financial impact the various financial options will have on you.
- If you can agree to the settlement parameters, we introduce you to suitable family lawyers that can assist in finalising documentation and processing your divorce proceedings. Where mediation is advised, we can also attend any meetings with the family lawyer and provide guidance on your financial needs.
- Starting a new life with less. Financially, the biggest challenge faced by divorced clients is how to live with assets that are half or less in value than what was previously owned jointly.
- Understanding the long-term consequences of your divorce and settlement. Have you thought about how you are going to get on financially for the next five or ten years, regardless of the outcome of the settlement?
- How to have your assets accurately valued. We can also advise on the division of the assets.
- How to structure your assets. Structuring can make a big difference to your wealth. Addressing taxation issues and super rollover releases can be easily overlooked. Family lawyers tend to have limited understanding of the different asset structures, particularly where superannuation is concerned. This is because their expertise is in family law, and they are restricted by legislation in giving financial advice.
- Whether to hang on to assets. Clients tend to be emotionally attached to some assets, especially houses where they have brought up families. Even though it is challenging, however, it is often the case that selling such an asset could make your life much easier from a financial point of view. This is the time where expert advice from an objective third party can help you look at practical implications.
- Funding ramifications.
- The need for discretion.
This collaborative approach is much more productive than the traditional confrontational approach to divorce.
Contact Collins Mann to find out more about how formalising your divorce might be quicker, cheaper and less stressful than you think. Please phone 3251 3200.