Dividing Assets with guest Rebecca Gill

This month, we welcome back Rebecca Gill of Dunlap Gill Wealth Management to discuss dividing assets during a divorce.

We work closely with Rebecca and her team on a Collaborative Practice Model. This process relies on mediation and negotiation to reach a divorce agreement. The collaborative approach is a great way to save time and money, while both parties seek to resolve the process without the intrusion of court-room litigation and judges. Most mediators and attorneys trained in Collaborative Practice describe it as a "problem solving" approach. A traditional litigation model is better described as a "fight and win" process.

The Collaborative Practice Model is a good fit if the parties would like to resolve the divorce amicably. The model is not a good fit if there are concerns about dishonest behavior.

At Carmel Family Law, we work with Dunlap Gill on many cases in and around Indianapolis, Indiana. Dunlap Gill serves as a neutral partner in the process. They help to create a clear picture of the assets to be divided.

The first step in the process is to collect all relevant information. Generally, this process begins with the tax returns but will include a detailed list of all assets. The first phase of the process is complete once Dunlap Gill has created a comprehensive financial statement that encompasses all of the household assets. This statement includes projections about how assets will change into the future for items like real-estate, 401Ks, pensions, etc.

Next, Dunlap Gill works with both parties to review the division plan. The goal is to create a division of assets that is a "win-win" for both parties. Dunlap Gill helps the spouses build short-term and long-term household budgets. Developing a clear household budget is essential because spouses must have reasonable expectations about the post-decree lifestyles.

With the financial statements and household budgets in place, Dunlap Gill offers advice on division scenarios. Understanding the tax implications of the division is an essential step in the process.

In the end, having the services of Dunlap Gill, or a different financial adviser is extremely helpful in a collaborative process. They serve as an independent expert to advise both parties on the short and long-term implications of the division.

Guest Blog! Michelle Gambs | Perfect Parenting - Stay Away from "D"

A big thank-you to Michelle Gambs for guest writing this post on our blog. Michelle is a local parenting coach and private practice psychotherapist with a master’s degree in counseling.

-Janice

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In our modern world of social media and perfectionism, parents everywhere are looking for a way to become a better parent. 

Parenting is complex to say the least, so if you’re looking for some relief from this difficult and at times, seemingly impossible job, here it is!

It’s a concept that I call, Stay Away From “D” and it’s a message that I want all parents to know about.

The following article is an excerpt from my 5-week parenting course on Redirecting Children’s Behavior.

I’ve published a video explaining the concept you can watch below.

The concept gives you permission to be human, make mistakes and to find comfort and relief in the fact that you do not have to be perfect!

Nor should you strive to be. 

So what does it mean to Stay Away From “D”?

Well, it is a very simple concept that gives 4 basic options to any situation that we may encounter as we parent our children. 

Here’s the 4 scenarios. 

A- Best Case Scenario

Is the best-case, textbook scenario.  

It’s the one that might seem perfect for the situation at hand. 

And in order to use this you have to have the tools in your toolbox so you can implement this option. 

So if you have the time, patience and resources. 

B- The Good Enough Option

Here is where you give yourself a break!

In every day life, this is the scenario where you say to yourself, “this is all I got” right now.

Given that I am low on sleep, behind at work or school, and I have a barking dog in the background while I’m trying to cook dinner… I just cannot handle it right now.  

So I’m just going to do my best and not beat myself up over it. 

C- Do No Harm

Is the option where you choose to remove yourself from the situation because you just need a break. 

You need time to regain your composure!

Perhaps something happened and you feel that you may react inappropriately or do something that may have lasting negative consequences so you just need to take a break from it all.

Remember that you’re 100% responsible for what you say and what you do no matter what is said or done to me. 

 D- Harm To Your Child

This is the scenario where you have found yourself in a situation where you may hurt, shame, yell, or otherwise cause permanent emotional or physical damage to your child. 

This is the one option out of the 4 that you should do whatever it takes, to avoid at ALL costs!

Stay away from option “D” which is causing harm to your child!

So next time you find yourself in a difficult position, remember to engage in any of the options, except D. 

If you stay within options A, B, or C, you are doing a great job at parenting and that’s all anyone can ask for. 

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Michelle Gambs is a parenting coach and private practice psychotherapist with a masters degree in counseling. She calls herself a Hoosier Texan as she has spent her childhood in Indiana with a degree from Notre Dame, and ten years of her adulthood as a Texan. She is a yogi/camino walkin’ mother of two fabulous young adults.

She teaches an Indianapolis based 5-week parenting course titled “Redirecting Children’s Behavior”.

The grand experiment of parenting is sponsored by her two children, Grace and Charlie. During the most desperate stages of parenting, she has been known to post on the bathroom mirror the quote, “I never said it would be easy, I only said it would be worth it.”

Michelle is also the host of a popular parenting podcast, called ParentED and can be found on Youtube.

P.A.R.T.I.N.G - 7 Things to remember if you are thinking about divorce

If you are considering a divorce, rest assured, you are not alone. If you are having trouble making the decision, rest assured, you are not alone. The decision to separate and divorce should is not one to make hastily. It demands careful consideration to make sure the decision is the right one. Even when the divorce is forced upon you, you must take the appropriate time to consider your future. 

Here are seven things to consider:

P is for Parenting 

Parents are always concerned about the effect of divorce on the children. Each family is different. Mostly, parents are the best resources for determining what’s best for the kids—even when adjusting to separation and divorce. When making custody and parenting time decisions, the Court will consider such things as 

• the age and sex of the children

• their adjustment to the home and community

• the wishes of the parents

• the wishes of the children (with more weight given to children 14 years or older)

• relationships with extended family members

• healthcare concerns

• the parent-child relationship

• history of domestic violence

• any “de facto” guardians

A is for Action

The divorce starts with the filing of a Petition for Dissolution of Marriage. There is a filing fee, and Indiana divorce law requires a minimum waiting period of 60 days. If you and your spouse can resolve all issues via negotiation and/or mediation, it’s possible to finish in 60 days. Divorces that require a judge to make decisions take much longer. The provisional/preliminary phase is the time between the filing of the dissolution and the final Decree. This is the time when you need to address big questions and resolve them by agreement or court order.

• Who will live where?

• Who will pay what bills?

• How will the household be supported to maintain stability for the children?

R is for Relationships with Professionals

The right team around you makes all the difference. Choose professionals you are comfortable with. You must have attorneys, therapists, counselors, and financial advisors that you are comfortable with. Pick people that have excellent reputations, but also make sure you can communicate and connect with your team. Choose people who are willing to listen to you and consider your concerns carefully.

T is for Timing

On one hand, timing is everything, Is this the right time? This is a question that is asked of me again and again. Timing may be a matter of personal circumstances—like holidays and anniversaries or children’s upcoming events. It can also be a matter of financial circumstances—like income changes, asset appreciation or depreciation, or changes in employment. 

On the other hand, you may not have the luxury of choosing the right time. You may be in a situation where your spouse has filed. Perhaps he or she has committed an act that requires an immediate divorce. You can still successfully negotiate the process. You must have a lawyer who can help to guide you through the emotional adjustment process as well as the “business” of asset and debt division. 

I is for Income

Indiana follows an “income shares model” in the calculation of child support. Gross income, including regular income, bonuses, commissions, car allowances, housing allowances, and perhaps even regular gifts are a part of gross income for child support purposes. If a party is unemployed or underemployed, his or her potential income can be considered. The Court will consider educational and employment background, availability of jobs, and potential income levels in determining the income imputed to an underemployed.

N is for Next Steps after filing the Petition for Dissolution 

Be prepared. Consider potential living arrangements and potential employment or employment changes. Gather financial documents, records, and tax returns for the previous two (2) years. Carefully review files and information to make sure you have accounted for all retirement accounts and life insurance policies. Finally, inventory assets with value such as paintings, coin collections, and jewelry. 

G is for Growth

You may not see it, but at the end of the dissolution process is the potential for personal and professional growth. In addition to your improvement, you will be amazed at your ability to achieve balanced and successful parenting. Believe in yourself! Believe that you will be better! Do not be content to accept your lot in life! Instead, be ready to take steps into a new future.

Financial Planning During a Divorce

Working through the financial aspects of a divorce is always a difficult and time-consuming process. We recently sat down with our friend Rebecca Gill to discuss the financial aspects of a divorce. Rebecca is COO at DunlapGill Wealth Management Group and is a Certified Public Accountant and Personal Financial Specialist. Rebecca and the team at DunlapGill provide excellent services to residents of Indianapolis, Fishers, Carmel, Noblesville, and other central Indiana communities. 

Below are a few concepts that we discuss in the video above. It is important to note that the tips below and the content of the video is for generalized information only. Each person's situation is different and it is important to meet with an attorney and financial advisor to develop a specific plan for your needs.

Start the process early. It can be very difficult to unwind anything after a divorce is final. You’ll want to make sure you have the complete picture, so it is important to gather information on income, physical assets, liabilities, retirement accounts, savings, life insurance, and other accounts. This will prepare you and your advisor to develop a customized post-divorce financial plan. Each spouse needs to have a plan that addresses short-term needs (like liquid assets) and long-term needs (like retirement savings).

 It’s important to have good credit established. We frequently see situations where one spouse has shouldered the financial burden for the household. All assets, deeds, credit cards, retirement accounts, loans, and mortgages are in one spouse’s name. This isn’t a big deal when dividing assets because Indiana’s divorce laws dictate the allocation. It is a big problem after the divorce is final. In this situation, the other spouse will have little or no credit history. It can be hard to get a mortgage, car loan or other credit extended when the bank doesn’t have a credit history to rely on—even though there may be significant liquid assets after the divorce. Make sure both spouses are building good credit to ensure stability after the divorce.

 You have flexibility with retirement accounts. In certain circumstances, you may be able to take early distributions from retirement accounts during a divorce. Remember, you’ll always be taxed on distributions, but you may be able to avoid penalties. It is important to consult with a financial advisor to balance your short and long-term needs via a master financial plan and to make sure your decisions won’t result in penalties or unnecessary taxes.

 Don’t forget to update your beneficiaries. It is common to get so caught up in the more detailed aspects of a divorce that beneficiaries aren’t updated. Don’t forget to update the beneficiaries of any life insurance, retirement or investment accounts during the process. It is also a good idea to review these with your attorney and a financial planner on an ongoing basis. Beneficiaries cannot be argued in an Indiana courtroom!

The Difference Between a Legal Separation and Dissolution

Legal separations can be used in several different situations for Indiana spouses. Generally speaking, separations allow spouses maintain the marriage while living separately with rules regarding expenses, parenting time, custody or other domestic matters. A legal separation is a good option if the relationship needs a “cooling off” period, if there is opportunity for reconciliation, religious concerns, or even if one partner needs to leave the home for medical reasons and Medicaid benefits.

Legal separations are also used in the period of time leading up to an official dissolution. They provide an initial framework while the parties are working out the final terms of the divorce. Decrees of Dissolution remain in effect for only one year, so if you see yourself heading for dissolution of the marriage, the legal separation action should be converted prior to the anniversary of the entry of the Decree of Dissolution by the Court.

In both a separation and dissolution, a decree is issued. The decree is the official document that outlines the parameters, or rules, that the parties will abide by. Because a separation maintains the marriage, it is a more flexible option and gives the parties flexibility in working out the terms of the decree, as well as the option to reconcile or move toward dissolution.

In dissolution, the action is final and permanent. Once the decree is issued, both parties must live by the terms and there is no opportunity to reconcile.

If you are considering a divorce, a legal separation is a good place to start.It allows you to be separated, while also laying out a framework for what each party is responsible for. In some cases, reconciliation happens after the separation. If not, you’ll already have a head start on the dissolution of the marriage and can move forward quickly.