Experience has shown that the lack of information causes some clients great difficulty with making life changing decisions.
An experienced financial neutral can help clients in many ways, also making the Lawyer’s job easier. Over the past 20 years Brad Corby (consultant and Founder of Divorce Solutions) has adapted a simple 3 step approach: Strategy/Structure/Solution
Strategy:
This involves understanding the client’s needs and objectives.
Clients will often say; “my lawyer said I should get 60%”. Further questions such as the following should be asked:
- “what does 60% look like?”
- “Where do you and the children live?”
- “What does your house look like?”
- “What type of car do you drive?
- “What school do your children attend?”
- “Do you have to work full or part time?”
A financial neutral is well trained in the process of uncovering and identifying the client’s real needs and wants.
Once the Strategic vision is clear, financial analysis can be used to identify settlement opportunities.
Structure:
Separation is one of the best times to consider structuring or restructuring your affairs, as part of any settlement. Opportunities exist with sage advice concerning Companies, Trusts, Family Trusts, Self-Managed Superfunds and/or the establishment of Child Maintenance Trusts or Education Funds.
A skilled lawyer can help align such structuring with your strategic vision (as achieved above) to explore possible options to benefit the family as a whole, and utilise tax strategies to relieve some of the financial pressures that can be placed on the two households.
An experienced financial neutral will provide a ‘cashflow’ comparison, between what’s current and the new options available. This often will bring parties closer together, in a joint endeavour to place the children first.
Solution:
An experienced financial neutral can compare offers between the parties using financial software. This will show the effects of your cashflow when considering income versus expenditure and the effect of the property division, over a stipulated length of time. This may be 1-3 years and then 5 and 10, through to retirement.
The Financial neutral can provide vital data regarding the long-term effect a ‘super split’ will have on a client. For example, a superannuation split of $200,000 now, might be as little as an additional $100 per week until retirement (10 or more years down the track) in order to get back in the same position, had the split not occurred. This could also free up more of the non-superannuation assets available to that party.
An experienced Financial Neutral is specifically trained in this area and understands what is helpful to you and what information is required by your Lawyer. Such information provided prior, is critical in any negotiations prior to and during a mediation.
In many cases the savings and benefits that can be obtained, by a careful and considered approach to settlement, provide the parties with certainty for many years into the future, along with securing the needs of any children.