What’s your financial IQ?
I can divide most of my divorce or separation mediation clients into two categories: the member of the couple who handles the finances, and the member of the couple who does not. In an overwhelming number of cases, my experience has been that one party is solely responsible for the finances, and the other party has little or no idea about the day-to-day or the long-term financial picture. Some people are just better with finances than others!
While this is common, it may have implications that effect the mediation. The non-financially savvy spouse may be or become distrustful of the spouse who has handled the couple’s finances all those years. They may be unable to create an accurate budget for projecting their future living costs (which is a part of all settlement agreements), without help from their partner or the mediator. It can affect negotiations around support (Child Support and Spousal Support), either expecting too much or asking for too little. And when the non-financially savvy spouse gives up asset and retirement distributions or support that they really can’t afford to be without, this can be disastrous for them in the future.
Keep in mind that the division of your marital assets and liabilities, including retirement accounts and loan debt can rarely be changed in the future if you should regret the decisions you made in mediation. When mediating your divorce or separation, it is important for you to become familiar with your household expenses and with the assets and liabilities that are marital. You may be able to do this with your soon-to-be-ex spouse. If you find the financial information being presented to be too complex, ask questions! The mediator can usually explain it in a way that you can understand. If that doesn’t work, or you and your spouse can’t work together, getting a financial advisor involved during the process can be in your best interest.