Certified Divorce Financial Analyst FAQ’s
1. How does a Certified Divorce Financial Analyst® (CDFA®) help divorcing individuals?
A CDFA® can help anyone navigating the financial aspects of a divorce. In fact, according to a survey conducted by the Institute for Divorce Financial Professionals, 89% of CDFA® Professionals surveyed responded that their clients had contacted them before hiring a divorce lawyer. An experienced CDFA® impartially analyzes financial data, including uncovering financial assets using forensics. In addition, your CDFA® can assist you with long-term financial solutions to help you plan your financial solvency well into the future.
The role of the CDFA® is to assist the client and his/her lawyer to understand how the financial decisions he/she makes today will impact that client’s financial future. A CDFA® offers help determining if your settlement is feasible from a financial standpoint. A CDFA® provides an objective viewpoint despite the emotional situation. The CDFA® also furnishes detailed and customized advice about your special financial needs at all stages of the divorce process; pre- during- and post-divorce.
2. A CDFA® Professional Can:
- Complete the detailed financial work for clients, making case preparation and settlements easier.
- Provide litigation support on the financial issues on separation and divorce.
- Analyze the short- and long-term effects of various property settlements.
- Help clients determine their future financial goals.
3. How does a Certified Divorce Financial Analyst® differ from other financial professionals?
Most financial planners and accountants excel in their chosen field, but they may have little to no training specifically related to the financial issues of divorce. A CDFA® is trained to help avoid the common financial pitfalls of divorce by determining short-term and long-term financial impact of a proposed divorce settlement, offering insight to the pros and cons of different settlement proposals, and creating personalized reports and graphs illustrating the financial status, cash flow and net worth. Overall, the alternatives best-suited for our client or both of them collectively.
4. How does a Certified Divorce Financial Analyst® who is also a financial advisor better serve those divorcing?
A CDFA® who is also dually registered as a financial advisor can more-fully delve into and identify the specific financial assets relating to property and investments best-suited for the client. These may include the dissection of retirement plans investments, brokerage and investment accounts that may include securities and other financial instruments including Employee Stock Ownership Plans, Deferred Compensation arrangements, and other plans. Some plans can provide a compliment to alimony that is a monthly income, life insurance to cover alimony and child support in case of the payor’s death. The advisor can more comprehensively make recommendations based on the advisor’s experience in the financial industry.
5. How does a CDFA® who uses an in-house TEAM approach better serve the client?
A CDFA® who has an in-house team of professionals can provide the services of CPA’s, Will, Trust and Estate Planning Attorneys, financial advisors, insurance advisors, and other ancillary professionals to give the client full and comprehensive advice from several disciplines. These professionals become a part of your overall planning TEAM and addresses all matters collectively.
6. I have an attorney; do I need a Certified Divorce Financial Analyst®?
A Certified Divorce Financial Analyst® becomes a part of your “divorce team,” providing litigation support or collaborative support to an attorney, depending on how you are divorcing. We will provide to an attorney our analyses, the backup documents and our recommendations so that we can assist an attorney in negotiating your best-possible outcome. One of the main questions regarding divorce is “Am I going to be ok financially?” Finding the right professional to assist with your financial questions is critical to the divorce process. Attorneys provide legal advice, CDFAs® provide financial advice. Keep in mind that the services offered by a CDFA® are not legal services, nor are they intended as a substitute for legal service. We will work with an attorney to ensure that both you and the attorney better understand the financial implications of your divorce. This allows the attorney to focus on the legal aspects of the case. Remember, a trained CDFA® provides financial solutions and the navigation of the financial elements of divorce.
7. What role does a Certified Divorce Financial Analyst® play in gathering financial data?
A CDFA® works with the client to identify and collect the financial data from the marriage and data that might be separate prior to the date of the marriage. From that we evaluate any key financial data related to divorce. These include income, deductions, living expenses for the husband and wife, real property, retirement and financial assets and liabilities. They are considered the financial specialist in a divorce case. An attorney can better focus on the legal aspects of the case. Remember, a trained CDFA® provides financial solutions and the navigation of the financial elements of divorce.
8. Who do Certified Divorce Financial Analysts® help?
CDFAs® are trained to advocate for both men and women. Our main goal is to help clients, male or female, and their attorneys, obtain an equitable financial divorce settlement – equitable meaning fair, not equal – by providing relevant financial advice. Because of the financial complexity of many divorces, we play an active role helping individuals and their lawyers’ sort through the financial issues related to divorce. Remember, a trained CDFA® provides financial solutions and the navigation of the financial elements of divorce.
9. What is Collaborative Divorce? What role does a Certified Divorce Financial Analyst® perform in a Collaborative Divorce?
Collaborative Divorce is an alternative to divorce without litigation. Collaborative Practice is a voluntary dispute resolution process that is developed to preserve the integrity and dignity of families in conflict. The CDFA® is a financial neutral support resource in a Collaborative Divorce. We work with both parties to understand their existing finances and explain the financial impact of different settlement options.
For more information of the legal aspects of a Collaborative Divorce and whether it is the right process for you, you should consult an attorney. Remember, a trained CDFA® provides financial solutions and the navigation of the financial elements of divorce.