DIVORCE SETTLEMENT -- MOST FREQUENTLY ASKED QUESTIONS
Q. How do I know I am getting a fair settlement?
A. Missouri and Illinois are equitable distribution states. This means that the property settlement must be equitable to both parties, not necessarily equal. The Court determines a fair and reasonable distribution that may be more than or less than 50% of any asset to either party. Jack can assist you in understanding the financial and tax impact of various settlement proposals
covering not only asset distribution and debt assignment, but spousal and child support. A financial expert may be necessary to assist you in obtaining the most optimal settlement.
Q. Do I need to have an attorney?
A. Although couples have the right to file pro se or in proper person, meaning without legal representation, I recommend that you always work with an attorney. I am not an attorney and cannot offer legal advice and
recommend that you always review my recommendations with legal counsel.
Q. Will I be able to receive alimony?
A. In Missouri and Illinois it is referred to as ‘spousal support’. Although, no two cases are the same, the tests for maintenance include consideration of the following: 1) Need - Can you support yourself with earned income
plus investment income? 2) Ability to pay - Does the payer of alimony have sufficient funds to pay? 3) Length of marriage - A long-term marriage (10 years or more) is typically a stronger case for the lower-earning spouse. 4) Health of both parties 5) Reasonable needs. Only an attorney can advise you how the specifics of your case may impact your ability to receive spousal support. If you and your spouse cannot agree on what is reasonable spousal support then a judge will make that decision.
Q. How do I know which assets are the best ones to keep?
A. Not all assets are created equal and some assets may have more of a beneficial effect on your financial future. Assets such as businesses and retirement accounts continue to grow. Other assets may require money
for their upkeep, such as a home and automobiles, and those costs must be considered in the overall settlement. Certified Divorce Financial Analysts are experienced in assessing these situations.
Q. Will I lose my pension?
A. Pensions and retirement plans are marital assets if earned during the marriage. However, it is possible to keep your pension and have it offset with other assets.
Q. Should the custodial parent keep the house?
A. This is a great question, and it's one of the most important overlooked questions. While the answer is sometimes yes, there also may be times when the answer is no. It's important to pinpoint exactly what it will cost to maintain the home, factoring in taxes and inflation and expense of upkeep. An analysis must be performed to determine if there is enough money to stay comfortable in the home and pay all the bills without being overextended. Once that has been determined, the advisability of retaining the home must be compared to that of giving up other assets (such as liquid accounts, retirement plans, etc.). Finally, all decisions need to be weighed against current economic and stock market conditions. Certified Divorce Financial Analysts are trained to help people answer this question before they commit to a settlement that cannot be changed.
Q. What if I bring a house into the marriage that is in my name only, and I add my spouse's name to the title?
A. You might have made a "presumptive gift" to the marriage and should consult with a family law attorney to discuss your options.
Q. Is my IRA considered marital property if it's in my name only.
A. Everything acquired during the marriage, no matter whose name it's in, is typically considered marital property. If you are going through a divorce, it would be important to evaluate the financial drawbacks to having your IRA included in the list of assets you retain, post divorce. Remember, the funds in the IRA cannot usually be accessed before age 59 1/2 without paying a 10% penalty for early withdrawal.
Q. I have never worked. Can I get Social Security?
A. If your spouse has worked and if you have been married for 10 years or more, than you are entitled to one-half of your spouse's Social Security or your own, whichever is higher--even if you are divorced. Your spouse still retains 100% of his/her Social Security benefit. This is an automatic guarantee and therefore it is not a negotiation point in a divorce. Social Security Administration website link.
Q. How do we figure how much child support should be paid?
A. Missouri and Illinois have Child Support Guidelines that are mandated by the State. However, the Guidelines get tricky when one (or both) spouses is an independent business owner who can control their wages. In this
situation, it typically helps to bring in a financial expert who can help determine the true potential income of the each spouse.
Q. Do we have to go to court?
A. Usually you will have to go to Court to settle custody and property issues. If you can't reach an agreement at all, then a court date is set and a judge hears the case. If you enter into a Collaborative Divorce and successfully complete the process you never have to go to Court.
Q. What is a QDRO and why do I need one?
A. A QDRO (or Qualified Domestic Relations Order) is the legal document that divides up a qualified pension or retirement account (including 401k's) pursuant to a divorce. Neither the Judgment of Divorce nor
the Property Partition is sufficient to divide up the qualified plans; a QDRO is needed, preferably before the divorce is final. There are many nuances that go into QDRO's and make it an advocating (versus neutral) document. In order to protect your assets, be sure to obtain qualified advice in this area from a specialists.
SagePoint Financial, Inc. does not offer legal services.
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