Deena and Greg, who are both in their forties, have recently decided to divorce. They are on good terms with each other, and they believe that they could resolve all of their issues amicably in divorce mediation. They are planning to meet with a mediator together before consulting with separate attorneys. One major concern is bothering them though. How can they plan financially for their children’s futures? It is not child support that Greg and Deena are concerned about. Their worry is that they do not believe they have adequately addressed either educational or estate planning.
Planning for Children’s Educational Needs and Beyond
Greg and Deena have similar incomes and plan to share custody of their minor children. They are confident that child support will not be an issue. Their worries about their children’s financial well-being pertain to the future. Deena and Greg do not even have wills. Over the past few years, they have had several discussions about their need for an estate plan, but neither of them has felt any particular rush. The majority of their assets consist of a family home and two retirement accounts. They own the home as tenants in the entirety and are each other’s retirement beneficiaries. Under New Jersey intestacy laws, if either of them died, the other would receive any other assets. Now that they are getting a divorce, however, they realize that things will change.
Greg and Deena have three children. Molly is 22 and recently graduated from college. Thanks to careful planning, she will be virtually debt free. Brian, on the other hand, is 14 and both Deena and Greg feel that they have not adequately planned for how he will fund his education. They are even more concerned about 12-year-old Lindsey, who has special needs.
Planning for Adult Children
Jim and Sophie are also planning to divorce, but they have somewhat different concerns. They are in their late 50’s, with two grown children, 26-year-old Emma and 24-year-old Nick. Sophie and Jim do currently have an estate plan. In addition to retirement assets, they own several properties as well as a portfolio of stocks and bonds. They are wondering what will happen to their estate plan now. Does simply filing for divorce mean that the plan it is no longer in effect? What about once the divorce is final? How can they be sure that their agreements regarding providing for their children will survive the divorce?
Both of these couples want to address estate planning during their divorce mediation. Greg and Deena also want to address college and special needs’ planning for their younger children.
Raising Educational and Estate Planning Issues with your Divorce Mediator
Divorce mediators are not able to provide legal or financial advice, but they can help you decide whether or not you need such advice. They can also help by ensuring that you engage in an open and collaborative dialogue to clarify your interests. These topics can be emotionally charged, something that mediators are well-equipped to handle. In many cases planning for children’s educational and adult needs will require the assistance of a financial planner and/or a trust and estates expert. Estate planning, in particular, requires preparation of additional documents beyond those necessary for the divorce. Mediation can be a good forum for coordinating this kind of planning with the execution of your marital settlement agreement.
In our next post, we will address a bit more specifically the kinds of things that each of these two couples may want to think about during divorce mediation. If you are interested in addressing college planning or estate planning as part of your divorce mediation, take advantage of our initial consultation to get answers to y9our questions and contact us today.