Managing your Expectations During Divorce Mediation

May 9, 2023
By Alternative Divorce Solutions

If you are going through a divorce, chances are you are worried that your financial situation may no longer be ideal. No matter which way you divide the pie, knowing that you are now supporting two households on the same amount of money that you used to use for one is a difficult pill to swallow. Despite the fact that there will be less money to go around, some people come to mediation expecting that they will not have to change their lifestyle. Unfortunately, the math just does not support this way of thinking.

If you are looking to preserve the financial security you have to the best of your ability, divorce mediation is certainly for you. To start with, instead of each of you spending thousands of dollars to retain your own divorce attorneys, you will pay a combined flat fee that will cover the entire mediation process from start to finish. This way, you are not cutting into your joint assets to cover the cost of litigation and you are starting off with more money to divide. Once you have made the choice to move forward with divorce mediation, however, you should commit to having reasonable expectations. This will give you the best chance of success. Here are some tips for managing your expectations going in:

1. Know what Separate Property is:

If you came into the marriage with property, or have inherited something during the marriage, that property will be your property. Conversely, if your spouse had property prior to marriage or received an inheritance while you were married, that will also be considered his or her separate property. Now that you are approaching the divorce, think about your life on a timeline. This is a conversation I always have with our divorce mediation clients. At the beginning of the timeline is “BM” or Before Marriage. At this time, any property you acquired is separate property. Upon divorce, assuming you have not commingled this property and no exceptions apply, this property will be and remain your property. It will not be divided 50/50.

After that, there is your marriage. This part of the timeline represents the point in time that community property rules start to kick in and apply to you. In reality, this means that if you bought sometime after this date or racked up any debt, it is joint. Upon divorce, these items are divided 50/50. A very important mark on the timeline to pay attention to is the date of separation. In divorce mediation, the clients mutually decide what their date of separation will be. For some, it is the date that they separated households. For others who are still living together, it is the date of their consultation. At Alternative Divorce Solutions, we always inform our clients that the date of separation is very significant. This is because, in essence, this date takes you back to the status you were “BM”. This means that anything you acquire after that date will be separate property, once again. In litigation, the date of separation is a heavily litigated issue when there has been property acquired that both parties want or debt acquired that one party doesn’t want.

So, why is this important? When you come to divorce mediation, the more you can understand about the way that property is treated the better. It really helps settlement when both people come into the process knowing what is fair and reasonable in the eyes of the law. Of course, in divorce mediation, you can agree to whatever you want. This means that you can even agree to split separate property or not to split community property. The choice is yours, but managing your expectations about what the law says is correct is very important.

2. Review your finances:

I can’t tell you how many times I have done divorce mediations where one spouse has not looked at the parties’ finances for years. This “out spouse” has no idea how much income there is, or what it costs to run their household. Often times, this spouse is under the impression that there is a lot more money to be divided than there really is. So, how do you manage these unrealistic expectations? When you start the divorce mediation process, your divorce mediator will give you some financial disclosure forms to fill out. These forms are your Schedule of Assets and Debts (FL-142) and your Income and Expense Declaration (FL-150). At Alternative Divorce Solutions, one of our divorce mediators will explain these forms in detail, and you will be given an instructional packet that further describes how to complete them. If you would like to learn more about these forms now, visit my recent blog http://altdivorcesolutions.com/financial-disclosure-important-divorce-mediation/

Basically, the purpose of these forms is to provide both parties a full picture of what property and debts there are, as well as what the household income and expenses are. Prior to starting your divorce mediation process, you should sit down and complete these forms. If you and your spouse are still on good speaking terms, sit down together and take your time reviewing these forms. Ask each other questions. The more information, the better. Once you have done this, keep gathering information and advice. Take the time to sit down with your financial advisor. If you do not have one, ask your divorce mediator for a referral. Then, speak to your accountant. Any information is power.

The time you invest in learning about your financial situation is time and money you will not have to invest in your divorce proceedings. When you know exactly what there is and how much it costs you to live, you can come into the divorce mediation process well prepared. Your expectations will also be aligned with black and white numbers.

3. If necessary, consult with an attorney:

While attorneys are not permitted to attend the divorce mediation itself, clients often consult with them in the background. In more contentious cases, I strongly recommend that each person seek the advice of independent counsel. Taking the time to sit down with an attorney can be beneficial. These attorneys can give each person advice and manage their expectations according to what each person would be awarded if they went to court. Although the advice will be an opinion and not an exact projection of what each party will receive (because the litigation process can be uncertain and unpredictable), it is still a way for each person to tune in to what they should be expecting.

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