Women, Divorce and the Economic Realities

Each year, nearly 2.8 million men and women go through Divorce. In the first year after the Divorce is final, a wife’s standard of living may drop almost 27 percent. Compare that to her husband’s standard of living—it may increase by as much as 10 percent! In the nearly 20 years that Guideway has been assisting our clients with Divorce, it’s hardly surprising that women are concerned about financial survival in the high-priced Bay Area.

Many factors contribute to lowering the standard of living         

Women generally end up with custody of the kids, and child support may not be enough to cover the actual cost of child rearing. For stay-at-home moms or those who held part-time jobs, getting back into the workforce and finding well-paying jobs is extremely difficult. It takes years to get on a career path to start making a good living. Divorce is expensive—there are court costs, therapist bills, getting established in new living situations based on a single paycheck. If you are contemplating divorce, now is the time to rethink your spending. Where can you cut back and start saving money that you’re going to need?

Do your research. Talk to single moms; consult with a financial adviser

If you’re contemplating Divorce, start doing some research. Talk to your friends who are single moms. Be fully aware of just how difficult it will be—especially if you don’t have family to help with the kids. Consult with a lawyer and a financial advisor. Make sure you’ve fully considered the impact of Divorce on your kids, your spouse and your life. Think about timing. If you’ve been married nine years, you might want to stick out the last year, so you can collect on your ex’s earnings record.

Make copies of all financial documents

Make a copy of all tax returns, loan applications, wills, trusts, financial statements, your mortgage, banking information, brokerage statements, loan documents, credit card statements, deeds to real property, car registration, insurance inventories, and insurance policies. If you have assets that you brought into the marriage, these will remain yours as long as you can document your ownership.

Be suspicious. Look for signs that your husband may be hiding income

Make sure you’re including any safe deposit boxes and reviewing pay stubs, retirement plans, and insurance policies. If your spouse’s business generates a lot of cash, find a forensic accountant to look for signs of additional income that he may be hiding. Don’t overlook hobbies or side businesses that generate income. Here’s an example: My neighbor Allen makes exquisite knives in his workshop that he sells for up to $1K/each. Working with iron and metal is his hobby, and when he sells something, there’s no record of it, and he doesn’t pay any taxes. But at $1K/each, he’s generating a nice little revenue stream. California is a community property state, and you’re entitled to half of this kind of income.

Did you help your husband get a degree or pay for grad school?

My accountant put her husband through law school, and he’s now a partner in a prestigious San Francisco law firm. When he wanted a divorce, she put her savvy CPA brain to work and received a generous compensation for those years she worked to put him through school.

Consider big-picture tax consequences

Get an accountant to help you make these decisions because they will have profound effects on your future and that of your children.

• Monthly alimony or a lump sum?
• What is his retirement plan worth?
• Should you keep the family home or sell it now?
• Who pays the mortgage until it sells?

Selling the family home is a difficult decision, but in too many cases, women hang on to the house because of the emotional bonds. They want their kids to stay in a neighborhood where they have friends and feel safe. But in too many cases, that home is too expensive to maintain. The constant upkeep, the landscaping and repairs, the mow and blow guy who comes once/week. All of this becomes a burden. Better to move to a smaller home in a neighborhood that’s more affordable.

Become your own advocate. Prepare for your future

Be informed. Taking an active role in the divorce negotiations will help you reach a better settlement. During our Guided Mediation, we often see couples improving communication through the mediation process. They will need this as they raise their kids together. Stand up for yourself and get your share so you’re able to take care of yourself and your children financially.

If you stayed home to take care of your kids, you’ll need to find a way to support yourself and your children. Get career counseling and training. You may need to go back to school, so prepare for the expense of tuition and books. You’re creating a new life for your family.

Guideway’s Divorce and Mediation Services

Guideway has been assisting Bay Area couples with Divorce for nearly 20 years. While the majority of our clients may not have worked out the details, they know they are willing to reach agreement on division of assets and a parenting plan—and those are the critical components of an Amicable Divorce. Our Guided Mediation is for couples whose Divorce has stalled for whatever reasons. We guide you through it, and we prepare the legal documents. Schedule an appointment with Guideway today.

Guideway services the entire Bay Area

Berkeley, El Cerrito, Richmond, Pinole, Alameda, San Leandro, Castro Valley Newark, San Lorenzo, Concord, Alamo, Danville, Lafayette, Orinda, Moraga, Pleasant Hill, Martinez, Pittsburg, Antioch, Brentwood, Oakley, Discovery Bay, Pleasanton, San Ramon, Livermore, Tracy and Fremont. Our clients also live in the Napa Valley, Benicia, Vallejo, Martinez, Fairfield.

Divorce in the New Year? Inspiring Stories of Coming Back Stronger

The American Academy of Matrimonial Lawyers tells us that the number of Divorce filings are one third higher than normal in the month of January. Not hard to figure out why. Too many people make silent promises that they’ll never spend another year—and most of all—another holiday, with their current spouses.

It takes hard-hearted parents to leave during the holidays, so they don’t

They wait until January, “Divorce Month”. But it’s still November, and while we’re just ratcheting up to the holidays—many people are absolutely miserable, secretly planning their escapes. While Divorce will be emotional and disruptive, take inspiration from a few New York Times readers who moved on from their divorces—stronger, happier and more capable!

• Twelve years after a difficult divorce, I look back with pride at the life I’ve built. I went back to graduate school, built a career and kept the house and maintained it beautifully. Took trips around the world with my girls and taught them how to be strong independent women.
• I relish each small successful repair, every picture hung perfectly, done by me with no screaming or worsened damage. I never felt as good sitting in a psychiatrist’s office as I do now when I’ve selected just the right drill bit to mount that anchor.
• Six years ago, I left a 30-year marriage and was terrified I would not know how to handle things — an apartment, finances, car repairs, caps on jars. All this fear, despite holding a demanding job. I learned how to use tools and fix things, and it was so satisfying. Now I know I can handle anything on my own.
• One very capable woman tells her story. Last fall, when local infections were sky high, the firewood still needed to be cut and split and family couldn’t come help me — so out I went. I felled over a dozen trees, cut everything into pieces, got it all back to my house, and split all the logs into firewood.
• A single dad weighs in. After the divorce I stayed in the marital home, took on shared custody and relished the opportunity to prove to both myself and my girls (and my son) that I could manage both a taxing job and being a good dad as well as a passable “mom”. It was a hectic period with very long days and short nights, but boy, was it worth it!

Guideway’s Divorce and Mediation Services

Guideway has been assisting Bay Area couples with their Divorces for nearly 20 years. If you and your spouse can reach agreement on division of assets and liabilities and a parenting plan, you don’t need an attorney, and we can save you a significant amount of money.

Divorce can seem overwhelming, but it’s a very methodical process

If you can figure out division of assets, you don’t need a lawyer, and we can save you a lot of money. Most of our clients may not have worked out the details, but they know they are willing to reach agreement—and that’s the critical component of an amicable Divorce.

Best of all, we guide you through it and we prepare the legal documents. Schedule an appointment with Guideway today.

We service the entire East Bay and North Bay areas

Berkeley, El Cerrito, Richmond, Pinole, Alameda, San Leandro, Castro Valley Newark, San Lorenzo, Concord, Alamo, Danville, Lafayette, Orinda, Moraga, Pleasant Hill, Martinez, Pittsburg, Antioch, Brentwood, Oakley, Discovery Bay, Pleasanton, San Ramon, Livermore, Tracy and Fremont. Our clients also live in the Napa Valley, Benicia, Vallejo, Martinez, Fairfield.