--- title: Our Blog - AMF Divorce | Finances description: Finances | From mortgage professionals to therapists to attorneys, the team at A.M. Financial works closely with these types of professionals. --- ## A.M. Financial - [Services](https://amf-divorce.com/divorce-transition-services) - [Service Plan](https://amf-divorce.com/service-plan) - [Frequently Asked Questions](https://amf-divorce.com/frequently-asked-questions) - [Our Blog](https://amf-divorce.com/our-blog) - [About Amy](https://amf-divorce.com/about-amy) - [Contact Us](https://amf-divorce.com/contact-us) - [Services](https://amf-divorce.com/divorce-transition-services) - [Services](https://amf-divorce.com/divorce-transition-services) - [Service Plan](https://amf-divorce.com/service-plan) - [Frequently Asked Questions](https://amf-divorce.com/frequently-asked-questions) - [Our Blog](https://amf-divorce.com/our-blog) - [About Amy](https://amf-divorce.com/about-amy) - [Contact Us](https://amf-divorce.com/contact-us) [Book a Meeting](https://calendly.com/amymahlenmelander/consultdivorcefinancialplanning) Posts about # Finances ## [Real Estate in Self-Directed IRAs: Hidden Risks in Divorce Settlement](https://amf-divorce.com/our-blog/real-estate-in-self-directed-iras-hidden-risks-in-divorce-settlement) July 01, 2026 Self-directed IRAs are not something that comes up in every divorce, but when they do, they tend to catch people off guard. The account may appear straightforward on paper as a [retirement asset](https://amf-divorce.com/our-blog/retirement-accounts-divorce-what-to-expect) with... [CONTINUE READING](https://amf-divorce.com/our-blog/real-estate-in-self-directed-iras-hidden-risks-in-divorce-settlement) ## [Preparing for Divorce Mediation](https://amf-divorce.com/our-blog/preparing-for-divorce-mediation) January 26, 2026 Most people think mediation success depends on what happens during the session. In reality, the biggest determinants of outcome happen weeks earlier, in the quiet, unglamorous work of preparation. [CONTINUE READING](https://amf-divorce.com/our-blog/preparing-for-divorce-mediation) ## [Post-Settlement Financial Support](https://amf-divorce.com/our-blog/post-settlement-financial-support) December 02, 2025 For many people, the hardest part of divorce seems like the negotiation itself, and sorting through assets, discussing support, weighing options, and finally reaching an agreement. But as a [CDFA](https://amf-divorce.com/our-blog/empowering-clients-and-attorneys-in-high-conflict-divorce-cases-the-role-of-a-cdfa),... [CONTINUE READING](https://amf-divorce.com/our-blog/post-settlement-financial-support) ## [Postnups & Cohabitations: The Benefits of Financial Clarity](https://amf-divorce.com/our-blog/postnups-cohabitations-the-benefits-of-financial-clarity) August 09, 2025 We’ve all heard about prenups and often in the context of celebrities or [high-net-worth](https://amf-divorce.com/our-blog/navigating-a-high-net-worth-divorce-financial-insights) individuals trying to protect their fortunes. Postnups deserve attention too, and these agreements can provide... [CONTINUE READING](https://amf-divorce.com/our-blog/postnups-cohabitations-the-benefits-of-financial-clarity) ## [What to Include When Dividing Investments in Divorce](https://amf-divorce.com/our-blog/what-to-include-when-dividing-investments-in-divorce) May 05, 2025 For many divorcing couples, splitting investment accounts can be one of the most complex and emotionally charged aspects of divorce. These accounts are far more than numbers on a spreadsheet and... [CONTINUE READING](https://amf-divorce.com/our-blog/what-to-include-when-dividing-investments-in-divorce) ## [How to Handle Spousal Support When the Payor Retires](https://amf-divorce.com/our-blog/how-to-handle-spousal-support-when-the-payor-retires) April 02, 2025 Retirement is a significant life event that can lead to complex financial questions, especially for those who are paying or receiving spousal support. Whether you are [negotiating spousal support](https://amf-divorce.com/our-blog/navigating-financial-transitions-approaches-for-a-smooth-transition) in... [CONTINUE READING](https://amf-divorce.com/our-blog/how-to-handle-spousal-support-when-the-payor-retires) ## [Licensed Legal Professionals: A Cost-Effective Option for Non-Complex Divorces in Colorado](https://amf-divorce.com/our-blog/licensed-legal-professionals-a-cost-effective-option-for-non-complex-divorces-in-colorado) February 05, 2025 As a financial professional who often works with clients navigating the financial complexities of divorce, I’m always looking for ways to help families manage the process more effectively. One... [CONTINUE READING](https://amf-divorce.com/our-blog/licensed-legal-professionals-a-cost-effective-option-for-non-complex-divorces-in-colorado) ## [Empowering Clients and Attorneys in High-Conflict Divorce Cases: The Role of a CDFA](https://amf-divorce.com/our-blog/empowering-clients-and-attorneys-in-high-conflict-divorce-cases-the-role-of-a-cdfa) January 02, 2025 Navigating the financial complexities of divorce can be one of the most challenging aspects of the whole process. This is especially true in high-conflict cases, where disagreements over financial... [CONTINUE READING](https://amf-divorce.com/our-blog/empowering-clients-and-attorneys-in-high-conflict-divorce-cases-the-role-of-a-cdfa) ## [Preparing for Divorce During the Holidays: Making Smart Financial Decisions](https://amf-divorce.com/our-blog/preparing-for-divorce-during-the-holidays-making-smart-financial-decisions) November 04, 2024 Going through a divorce is emotionally taxing on its own, but when the holidays are added to the mix, the challenges intensify. The season that's meant for celebration can quickly become... [CONTINUE READING](https://amf-divorce.com/our-blog/preparing-for-divorce-during-the-holidays-making-smart-financial-decisions) ## [FAFSA Changes for Divorced Parents: What You Need to Know](https://amf-divorce.com/our-blog/fafsa-changes-for-divorced-parents-what-you-need-to-know) July 08, 2024 If you're a divorced parent or currently going through a divorce, the college application process can be particularly confusing. Applying for colleges, scholarships, and financial aid is complicated... [CONTINUE READING](https://amf-divorce.com/our-blog/fafsa-changes-for-divorced-parents-what-you-need-to-know) - - [1](https://amf-divorce.com/our-blog) - [2](https://amf-divorce.com/our-blog/tag/finances/page/2) - [3](https://amf-divorce.com/our-blog/tag/finances/page/3) - [4](https://amf-divorce.com/our-blog/tag/finances/page/4) - ##### About Amy With compassion and patience, Amy focuses on her client’s unique priorities to build a financial road map that provides clarity to make informed decisions today regarding the future. ##### Links - [Home](https://amf-divorce.com) - [Services](https://amf-divorce.com/divorce-transition-services) - [Our Blog](https://amf-divorce.com/our-blog) - [About Amy](https://amf-divorce.com/about-amy) - [Contact Us](https://amf-divorce.com/contact-us) - [Schedule a Meeting](https://calendly.com/amymahlenmelander) ©2026 Copyright. All rights reserved. A.M. Financial provides supporting financial information, evaluation and analysis to be utilized by the client and the client’s selected attorney if directed, during the process of their divorce. ervices provided in regards to this agreement are solely fee-only and do not involve investment or security advice or insurance transactions. All information is financial in nature and should not be construed or relied upon as legal or tax advice. A.M. Financial IS NOT AN ATTORNEY AND DOES NOT PROVIDE LEGAL OR TAX ADVICE. Individuals are encouraged to seek competent legal and tax advice from professionals who specialize in divorce and tax laws in their respective state. Amy Melander (CRD #4692263) is an Investment Adviser Representative of OneDigital Investment Advisors, LLC (ODIA). ODIA and A.M. Financial are independent and unaffiliated entities. ODIA does not offer or provide divorce financial planning services and any statements and/or opinions expressed by A.M. Financial do not represent the views and/or opinions of ODIA.   This website is a publication of A.M. Financial. Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the authors as of the date of publication and are subject to change. Content should not be viewed as personalized investment advice or as an offer to buy or sell, or a solicitation of any offer to buy or sell the securities mentioned herein. A professional adviser should be consulted before implementing any of the strategies presented. Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design) and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements. ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "articleBody" : "Self-directed IRAs are not something that comes up in every divorce, but when they do, they tend to catch people off guard. The account may appear straightforward on paper as a retirement asset with a stated value, but what is ‘inside’ can change everything about how it needs to be handled. When the asset is real estate, the complexity multiplies quickly. These accounts show up most often among entrepreneurial couples or higher-net-worth households where one spouse has moved beyond traditional retirement investments and into alternative assets. If you are going through a divorce and a self-directed IRA is part of the marital estate, understanding what it actually is matters before any settlement decisions are made. In this post, we’ll review what you need to know about these accounts. What Is a Self-Directed IRA? A self-directed IRA, or SDIRA, functions like a traditional IRA in terms of its tax structure, but it gives the account holder control over a much broader range of investments. Rather than being limited to stocks, bonds, and mutual funds, a self-directed IRA can hold real estate, private placements, promissory notes, limited partnerships, and other alternative assets. That flexibility is the appeal. But it also comes with a strict set of rules that govern how those assets can be held, managed, and eventually distributed, and those rules do not pause for a divorce. How Real Estate Works Inside an SDIRA This is where the confusion often starts. When real estate is held inside a self-directed IRA, the IRA owns the property, not the individual. This has consequences that shape everything from how the property is managed day-to-day to how it can be divided in a settlement. Because the IRA is the legal owner, all expenses related to the property, including maintenance, taxes, repairs, and insurance, must be paid from IRA funds. Income generated by the property, such as rental income, goes back into the IRA. It cannot be paid directly to the account holder as personal income. For divorce purposes, this matters when considering what income is available for support calculations. Income flowing into the IRA is not the same as income in hand, and whether it can be considered for support purposes is a question an experienced divorce attorney will need to help answer. There is also a personal use prohibition. The account holder cannot live in the property, vacation in it, or use it in any personal capacity. The IRA holds it as a pure investment asset, and that line cannot be crossed without triggering serious tax consequences. Divorce-Specific Issues The first challenge in divorce is figuring out what the asset is actually worth, and with real estate inside an SDIRA, that is not as simple as pulling a property appraisal. An appraisal reflects market value, but it does not necessarily reflect what could realistically be received in a sale. Factors like limited liquidity, the restricted nature of the asset, and discounts for lack of marketability or control can all affect true value. A property that appraises at $400,000 may not net anywhere near that after the layers of restriction and costs associated with selling it out of a retirement account are considered. It is also worth watching for double-counting. In a divorce, retirement accounts and real estate are sometimes inventoried separately. If the real estate inside the SDIRA is captured as both a retirement asset and a real estate asset, the value is being counted twice, which can distort the picture of what is actually in the marital estate. Self-directed IRAs also carry strict rules around what are called prohibited transactions. The account holder cannot personally use the property, and unless real estate is their primary profession, they generally cannot perform repairs or management work on it themselves. Violating these rules can cause the IRA to lose its tax-advantaged status entirely, and divorce is not an exception. Unlike a brokerage account or a cash balance, you cannot simply split real estate inside an SDIRA in half. There is no easy mechanism to divide the asset between two parties, which means most resolutions come down to one spouse retaining the account, selling the property and dividing the proceeds, or offsetting the receiving spouse with other assets of comparable value. There is also a longer-term consideration. Once the IRA account holder reaches the required minimum distribution age, which is currently 73 for those who turn 73 before 2033, and 75 for those who reach that milestone afterward, distributions must begin. If the IRA's primary asset is illiquid real estate, meeting those distribution requirements may eventually require selling the property, whether the timing is favorable or not. A Real-Life Example Consider a couple where one spouse holds a self-directed IRA with a piece of commercial real estate inside it. The property has an appraised value of $450,000, and there is no mortgage. The IRA owns it free and clear. On paper, it looks like a $450,000 retirement asset to be divided. But a closer look reveals several complications. The property has been difficult to lease and sits partially vacant. A realistic sale in the current market would likely yield closer to $380,000 after costs, and the timeline to sell could stretch well beyond the divorce itself. The other spouse has been offered the property as part of their share of the marital estate in exchange for relinquishing claims on other accounts. Before accepting, they would need to understand that they cannot use the property personally, that all expenses must continue to be paid from IRA funds, that the IRA custodian must approve the transfer structure, and that eventual required distributions may force a sale. What looked like a clean asset to receive turned out to carry a set of restrictions and risks. Working Through This with the Right Support If a self-directed IRA holding real estate is part of your divorce, several things need careful attention before any agreement is reached. Questions to ask include: Has the asset been reviewed by someone who understands both SDIRA compliance rules and divorce financial planning? Has the property been valued with liquidity and marketability factors in mind, not just a standard appraisal? Has anyone confirmed there is no double counting of the asset in the marital estate inventory? Is a direct offset with other assets a cleaner path than attempting to transfer or divide the SDIRA itself? Has the account custodian been consulted about how a transfer incident to divorce would need to be structured? Are the required minimum distribution timelines relevant given the account holder's age, and what might that mean for the property long-term? Self-directed IRAs holding real estate are among the more complex assets that can appear in a divorce settlement. The stated value is rarely the whole story; the rules governing the asset are strict and do not bend for a divorce, and the path to dividing or transferring it requires coordination between the IRA custodian, a tax advisor, and a financial professional who understands how these accounts work in a divorce context. If this type of asset is part of your situation, getting the right people involved early, before a settlement is structured, is the most important step you can take. Contact me to learn more about how I can help bring clarity to the financial side of your divorce.", "author" : { "@type" : "Person", "name" : "Amy Mahlen", "sameAs" : "", "url" : "https://amf-divorce.com/our-blog/author/amy-mahlen" }, "dateModified" : "01/07/2026", "datePublished" : "01/07/2026", "headline" : "Real Estate in Self-Directed IRAs: Hidden Risks in Divorce Settlement", "image" : { "@type" : "ImageObject", "height" : 400, "url" : "https://39875594.fs1.hubspotusercontent-na2.net/hubfs/39875594/Imported_Blog_Media/qtq80-HpSslk-768x512.jpeg", "width" : 750 }, "mainEntityOfPage" : "https://amf-divorce.com/our-blog/real-estate-in-self-directed-iras-hidden-risks-in-divorce-settlement", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "" }, "name" : "A.M. Financial", "url" : "amf-divorce.com" } } ``` ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "articleBody" : "Most people think mediation success depends on what happens during the session. In reality, the biggest determinants of outcome happen weeks earlier, in the quiet, unglamorous work of preparation. Clients who walk into mediation without a clear understanding of their goals, finances, and priorities often describe the experience as overwhelming, reactive, and emotionally draining. Decisions get made under pressure. Concessions happen quickly. People frequently leave the room unsure whether the agreement they reached will actually work in real life. By contrast, clients who prepare thoughtfully tend to describe mediation very differently. They feel more confident. Conversations are more focused. Tradeoffs are intentional rather than impulsive. And agreements are far more likely to support long-term financial and emotional stability. Preparation doesn’t guarantee an easy mediation, but it dramatically increases your control over the process. We have the tools to help. Preparation Is More Than Gathering Documents When people hear “mediation prep,” they often think it means pulling bank statements and tax returns. While documentation matters, true preparation runs deeper. Effective mediation preparation involves: Clarifying what actually matters to you long-term Understanding the difference between what you’re asking for and why you’re asking for it Gaining a realistic picture of your current and future financial needs Knowing which issues are non-negotiable and where flexibility exists Entering the room with a plan instead of reacting in real time Without this foundation, mediation can quickly turn into a series of positional arguments like “I want the house,” “I need more support,” “This isn’t fair”. Those arguments can stall progress and increase conflict. Positions vs. Interests One of the most powerful, and least understood, concepts in mediation is the difference between positions and interests. A position is a specific demand, while an interest is the underlying need or concern driving that demand. When mediation gets stuck, it’s almost always because people are negotiating positions instead of interests. Positions tend to create rigidity. Interests create options. Understanding your own interests and learning how to articulate them clearly opens the door to more creative, workable solutions. It also helps you anticipate your spouse’s concerns, which can significantly reduce tension and speed up negotiations. This mindset shift alone can change the entire tone of mediation. Financial Clarity Is Non-Negotiable Another common pitfall in mediation is negotiating financial outcomes without a clear understanding of what life will actually cost after divorce. Many people have never built a true future budget on their own. Expenses that were once shared become individual responsibilities. New costs appear. Others disappear. Support structures, such as spousal or child, interact with income, housing decisions, and lending eligibility in ways that are often misunderstood until it’s too late. Walking into mediation without this clarity makes it nearly impossible to evaluate whether a proposed agreement is sustainable. Numbers may “work” on paper but fail in practice. When you understand your current budget, project a realistic future budget, and connect those numbers to asset division and support conversations, mediation becomes far more grounded and productive. The Marital Balance Sheet: Overwhelming, but Essential The Marital Balance Sheet is often the document people dread the most, and for good reason. It forces you to confront the full scope of assets, debts, classifications, and values. Avoiding it doesn’t reduce stress. It postpones it. When you understand how assets are categorized, how equalization works, and why a mathematically balanced division may still fail in real life due to taxes, liquidity, or lending rules, you gain leverage, not over your spouse, but over the process itself. A balance sheet creates clarity, which replaces fear. Your questions become specific, and decisions become intentional. Mediation Rewards Clarity and Strategy Mediation is expensive, emotionally taxing, and time-limited. It is not designed to be a working session where you discover your priorities, learn how support works, or realize mid-conversation that a proposal won’t allow you to qualify for housing. The most effective mediations are those where the groundwork is already done, and the session itself is used to refine, negotiate, and finalize, not educate or triage. Over the years, I’ve seen the same pattern repeatedly: clients want to prepare well, but they don’t know where to start or how deep to go. That gap is what led me to create the Entering Divorce Mediation Prepared E-Workbook, which is a structured, self-paced guide designed to help you prepare financially, strategically, and thoughtfully before mediation. The workbook walks you through: Clarifying goals, interests, and priorities Understanding and organizing current and future budgets Making sense of the marital balance sheet and asset division Preparing for mediation day with clarity and confidence It includes guided worksheets, reflection prompts, and planning tools designed to be completed over several days, ideally a few weeks before mediation, so you have time to review your information with professionals if needed and enter the process grounded and informed. The e-workbook will be available in two formats: Self-Guided E-Workbook ($149): A thoughtful framework for those who want to work through the material independently, prepare confidently, reduce uncertainty, and approach mediation with clarity and intention. Premium Preparation Package ($299): Includes the workbook plus a one-hour session to review your worksheets, refine your mediation strategy, and address questions before mediation Divorce mediation doesn’t reward the loudest voice or the strongest position. It rewards preparation. When you understand what you truly need, why it matters, and how your financial reality supports or constrains your options, mediation stops feeling like something that’s happening to you. It becomes something you actively shape. If you’re preparing for divorce mediation and want a clear, structured way to think through your goals, finances, and priorities before you enter the room, the Entering Divorce Mediation Prepared E-Workbook is available for download. Preparation doesn’t eliminate difficult conversations. It makes them more productive. Join the waitlist to download our upcoming Entering Divorce Mediation Prepared E-Workbook today.", "author" : { "@type" : "Person", "name" : "Amy Mahlen", "sameAs" : "", "url" : "https://amf-divorce.com/our-blog/author/amy-mahlen" }, "dateModified" : "26/01/2026", "datePublished" : "26/01/2026", "headline" : "Preparing for Divorce Mediation", "image" : { "@type" : "ImageObject", "height" : 400, "url" : "https://39875594.fs1.hubspotusercontent-na1.net/hubfs/39875594/Imported_Blog_Media/qtq80-fzKOXT.jpeg", "width" : 750 }, "mainEntityOfPage" : "https://amf-divorce.com/our-blog/preparing-for-divorce-mediation", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "" }, "name" : "A.M. Financial", "url" : "amf-divorce.com" } } ``` ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "articleBody" : "For many people, the hardest part of divorce seems like the negotiation itself, and sorting through assets, discussing support, weighing options, and finally reaching an agreement. But as a CDFA, I’ve learned that implementing those decisions is often just as challenging. The truth is that divorce does not feel complete simply because the papers are signed. A settlement is a roadmap, but someone still has to do the driving. For many people, that journey feels overwhelming, confusing, and emotionally exhausting, especially when navigating it alone. Post-settlement financial support can often make all the difference. With a clear plan, steady guidance, and someone to walk through each step with you, the transition becomes far more manageable. A knowledgeable partner who understands the financial implications of this stage of the process can help ensure that every detail is handled correctly, every requirement is met, and every decision aligns with your long-term financial stability. Why Post-Settlement Support Matters Even the cleanest, most straightforward divorce agreement requires careful follow-through. Clients often underestimate the sheer volume of tasks that come after the decree is entered, including opening new accounts, transferring investments, retitling assets, updating beneficiaries, establishing new insurance, and taking care of the dozens of small but important steps that make the financial transition complete. This work is particularly stressful because it comes at a time when people are often emotionally drained. It’s common for individuals to feel unsure where to begin, afraid of making a mistake, or simply too overwhelmed to keep track of the deadlines and documentation required. Post-settlement support fills that gap with someone who understands the agreement, knows the financial landscape, and can guide the process from start to finish. What This Support Looks Like in Practice Working with individuals after their divorce helps them carry out the financial terms of their settlement. The process is highly personalized. By creating a clear sequence of steps, clients can move through each one. This includes setting up new accounts, establishing online access, completing transfer paperwork, and making sure that every asset is moved and titled correctly. A large part of this work also involves making transfers in a tax-efficient way, which is something many people understandably struggle to navigate on their own. Much of the support is hands-on and can include joining clients on calls with financial institutions to help ensure nothing gets missed or mishandled. Confirming beneficiary changes, review account titling decisions, and walking clients through updates to credit cards, phone plans, insurance coverage, and other elements of financial life that are impacted by divorce are common steps. For many, the process also includes preparing for the purchase of a new home, which requires thoughtful planning around cash availability, timing, and asset transfers. For those who want continued guidance, long-term financial planning, budgeting, and investment management are helpful services. Some clients choose to work together beyond the immediate post-divorce period so they can build a more solid financial foundation for the next stage of their lives. A divorce settlement outlines the plan. But the real transformation happens when that plan is carried out with care, clarity, and attention to detail. Post-settlement financial support ensures that every step is handled correctly and that individuals can move forward with confidence and not confusion. If you or someone you know needs support implementing the financial terms of a divorce, or if you’re an attorney seeking a trusted resource for clients after their case concludes, we’re here to help. Clients begin with a brief consultation where we determine the scope of support they need. Some choose comprehensive guidance throughout the entire implementation process, while others prefer help with specific tasks. Either way, they don’t have to navigate the transition alone. With the right support, the process becomes smoother, more organized, and aligned with their long-term financial goals.", "author" : { "@type" : "Person", "name" : "Amy Mahlen", "sameAs" : "", "url" : "https://amf-divorce.com/our-blog/author/amy-mahlen" }, "dateModified" : "02/12/2025", "datePublished" : "02/12/2025", "headline" : "Post-Settlement Financial Support", "image" : { "@type" : "ImageObject", "height" : 400, "url" : "https://39875594.fs1.hubspotusercontent-na1.net/hubfs/39875594/Imported_Blog_Media/qtq80-uhWlNr.jpeg", "width" : 750 }, "mainEntityOfPage" : "https://amf-divorce.com/our-blog/post-settlement-financial-support", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "" }, "name" : "A.M. Financial", "url" : "amf-divorce.com" } } ``` ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "articleBody" : "We’ve all heard about prenups and often in the context of celebrities or high-net-worth individuals trying to protect their fortunes. Postnups deserve attention too, and these agreements can provide financial clarity and support for a marriage even after the vows, or offer a clear foundation in a new relationship after divorce. As a Certified Divorce Financial Analyst, I work with clients at every stage of the relationship lifecycle, from preparing for marriage, navigating divorce, cohabiting with new partners, to planning second or third marriages. In my work, I’ve helped clients understand that clarity around money in relationships isn’t just protection, it can even be a form of connection. When we’re honest about our financial realities, needs, and expectations, we give our relationships a chance to thrive with clarity instead of confusion. In this post, I’ll share more about how these realities look in real life and examine how these decisions play out in the real world. Financial Planning is Essential for Second Marriages Prenuptial and postnuptial agreements often get a bad reputation, but when created thoughtfully, they can be powerful tools for building trust and long-term stability. I’ve worked with couples entering second marriages who want to protect what they’ve built and support each other’s futures. In one case, a retired, financially secure man partnered with a woman coming out of a difficult divorce and working long hours to rebuild her retirement. They didn’t want a one-sided agreement and they designed a plan that honored both of their needs. Through financial planning, I helped provide the financial information they needed to help create a prenup that reflected mutual respect and shared goals. We mapped out what she needed to feel secure and what he felt comfortable providing if the marriage didn’t last. The result was that she was able to reduce her hours, take a sabbatical, and ultimately pivot to a more fulfilling career. A well-crafted prenup doesn’t prepare a couple for failure, but it builds a stronger, more intentional partnership. Cohabitation and Knowing Where You Stand More couples today are choosing to live together without getting married, especially after a divorce. While cohabitation might feel more flexible or low-pressure, it still carries serious financial implications, particularly if you’re moving into a partner’s home. If you’re not on the title, have no formal agreement, and are contributing to expenses or home improvements, you may have little to no legal protection if the relationship ends. These risks aren’t limited to one gender or income level. No matter who you are, it’s important to understand your financial rights, set clear expectations, and protect your future, because cohabiting without a plan can be just as risky as marrying without one. More young couples are embracing traditional gender roles, with one partner, often the woman stepping away from paid work to care for the home or future children. Sometimes this happens without marriage, and while everyone has the right to choose the lifestyle that works for them, it’s crucial to understand the financial risks involved. If you're financially dependent on a partner and you're not legally married, you may have little to no legal protection if the relationship ends. Understanding how money works in your relationship isn’t unromantic; it’s responsible. In fact, it's an act of self-respect and long-term care. Whether you’re planning a marriage, recovering from a divorce, moving in with a partner, or simply trying to avoid financial mistakes, you don’t have to go it alone. Postnups, prenups, mortgage planning and cohabitation agreements are tools that exist for a reason. Not to replace trust, but to support it. Not to assume the worst, but to build a clearer path forward. If you’re navigating any of these situations, I’m here to help. And if you’ve got adult children heading into relationships of their own, consider giving them the gift of financial clarity too. Contact me to learn more.", "author" : { "@type" : "Person", "name" : "Amy Mahlen", "sameAs" : "", "url" : "https://amf-divorce.com/our-blog/author/amy-mahlen" }, "dateModified" : "09/08/2025", "datePublished" : "09/08/2025", "headline" : "Postnups & Cohabitations: The Benefits of Financial Clarity", "image" : { "@type" : "ImageObject", "height" : 400, "url" : "https://39875594.fs1.hubspotusercontent-na1.net/hubfs/39875594/Imported_Blog_Media/Couple-with-Advisor-Resized.jpg", "width" : 750 }, "mainEntityOfPage" : "https://amf-divorce.com/our-blog/postnups-cohabitations-the-benefits-of-financial-clarity", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "" }, "name" : "A.M. Financial", "url" : "amf-divorce.com" } } ``` ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "articleBody" : "For many divorcing couples, splitting investment accounts can be one of the most complex and emotionally charged aspects of divorce. These accounts are far more than numbers on a spreadsheet and usually represent years of planning, sacrifice, and shared goals. From a Certified Divorce Financial Analyst’s (CDFA’s) perspective, the key to a smooth division lies in proactively dividing these assets with clarity. One of the most important and overlooked steps in this process includes making sure the language in your settlement agreement accurately reflects what’s being divided, how it’s being transferred, and when to expect those transactions. In this post, we’ll dive into these specifics. Why Clear Language Matters in Investment Division Settlement agreements are legal documents, and vague or missing language can have both financial and legal consequences. Ambiguity about which investments are being transferred, how they’re being divided, or who bears responsibility for gains and losses can spark unnecessary conflict even years after your settlement. Clarity helps protect everyone involved. It helps prevent the stress of future disagreements, reduces the chance of enforcement issues, and supports a cleaner financial break, which is what most people are hoping for when they finalize a divorce. Make the Transfer Method Explicit Even beyond what is being transferred, it’s critical to determine how it’s being transferred, and the latter matters more than you may recognize. Cash versus Investments Clarifying whether one person receives a specific dollar amount, or whether a portion of the investment portfolio itself is transferred is critical to a smooth division of assets. This decision affects more than just paperwork and also can impact: Taxes: Selling investments to create cash may trigger capital gains. Liquidity: Cash might be needed for immediate expenses, but holding investments could support long-term growth. Growth Potential: Transferring investments “in-kind” allows them to continue compounding without disruption. These details should be discussed and documented before finalizing the agreement so expectations are aligned and execution is smoother. Key Elements to Include in Your Settlement Agreement When cash is being transferred as part of a divorce settlement, it’s important to include clear, specific instructions in the agreement. Start by setting a firm deadline for when the funds must be delivered. Then, define exactly how the transfer will take place. If the funds will be moved electronically, specify the account and custodian to ensure there’s no confusion. If a physical check will be issued instead, include the name of the recipient and the correct mailing address. It’s also wise to account for potential timing delays because transfers around weekends, holidays, or bank processing windows can slow things down. Building in a little cushion around timing can help prevent unnecessary stress. If Investments are Being Transferred: Use specific terminology to avoid future disputes. Three common items that should be included if transferring investments are: In-Kind Transfer: Specific investments (not cash) are moved “as-is” to the recipient’s account. This means the exact securities, the same number of shares or same positions, change hands without being sold. For clarity, it might be helpful to add that the cost basis (how much the investment was originally purchased for) will also transfer with the investment because this will play a role later whenever the investment is sold in the future. Pro-Rata Transfer: This means that each investment in the portfolio is divided proportionally based on the agreed-upon percentage of division in your final divorce agreements. Sometimes these amounts are listed in written agreements as percentages. If the division amount is listed as a dollar amount, then you will need to calculate what the percentage is based on the dollar amount agreed upon (effectively the dollar amount agreed upon divided by the account value multiplied by 100). This approach ensures fairness by preventing one party from choosing only the highest-performing assets. Gains and Losses: One often-overlooked detail in written agreements describing the division of investments is whether market gains or losses that occur between the date of the agreement and the actual date of transfer should be included or excluded. This can significantly impact what each party ultimately receives. For instance, if someone is awarded $100,000 from an account valued at $500,000, are they receiving a fixed dollar amount, or are they entitled to 20% of the account no matter what that value happens to be at the time of transfer? This distinction becomes especially important during periods of market volatility. Clearly outlining how to handle gains and losses helps maintain fairness and manages expectations on both sides, reducing the risk of disputes after the agreement is finalized. The Role of a CDFA A CDFA can be an invaluable partner throughout this process. While a CDFA doesn’t provide legal advice, a CDFA can help you: Assess tax implications of different transfer strategies Understand which assets to keep vs. liquidate Plan with an eye toward long-term financial goals, not just immediate needs Bringing a CDFA into the conversation early can help you avoid costly mistakes, feel more confident in your decisions, and navigate the process with greater clarity. When it comes to investments, details make all the difference. Taking the time to clearly define how accounts will be divided, and documenting that in your agreement, can prevent future misunderstandings and reduce stress post-divorce. Whether you’re in the early stages of negotiation or finalizing your settlement, consider bringing a CDFA into the conversation. Getting the support you need from the right professionals throughout your divorce can help your future feel a little less uncertain. Contact me today for a free consultation.", "author" : { "@type" : "Person", "name" : "Amy Mahlen", "sameAs" : "", "url" : "https://amf-divorce.com/our-blog/author/amy-mahlen" }, "dateModified" : "05/05/2025", "datePublished" : "05/05/2025", "headline" : "What to Include When Dividing Investments in Divorce", "image" : { "@type" : "ImageObject", "height" : 400, "url" : "https://39875594.fs1.hubspotusercontent-na1.net/hubfs/39875594/Imported_Blog_Media/qtq80-IC3Cpl.jpeg", "width" : 750 }, "mainEntityOfPage" : "https://amf-divorce.com/our-blog/what-to-include-when-dividing-investments-in-divorce", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "" }, "name" : "A.M. Financial", "url" : "amf-divorce.com" } } ``` ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "articleBody" : "Retirement is a significant life event that can lead to complex financial questions, especially for those who are paying or receiving spousal support. Whether you are negotiating spousal support in an initial divorce settlement or considering modifications due to retirement, understanding the factors that influence these decisions can help you make the best choices for your financial future. In this post, we discuss the topics that might be on your mind, what you can do about spousal support changes in retirement, and how a CDFA can help. Consider Retirement in the Initial Agreement When spousal support is on the table in your divorce, or if you have been receiving it for some time, consider what will happen when the payor eventually retires. If the payor is already in their 50s at the time of divorce and planning to retire early, addressing this possibility in your decree can prevent complications later. Some couples create a maintenance plan that takes into consideration future expected pension payments and social security income. One possible solution could be to gradually decrease maintenance within a certain timeframe to accommodate a known retirement date. This type of planning can provide both parties with financial stability, remove uncertainty in the years ahead and avoid possible court and attorney involvement in the future. Understand the Modifiability of Maintenance The ability to modify spousal support depends on how it was initially structured. In Colorado, if the agreement is a contractual agreement and specifies a specific amount and term, it generally cannot be altered, even if the payor retires. However, if maintenance is based on state statutes, which is more common, it may be subject to modification when a significant change in circumstances occurs, such as retirement. Courts and your legal counsel will attempt to determine whether the retirement is reasonable, and if the payer is attempting to retire early solely to avoid paying support, the modification could be denied. Analyze Financial Impact Post-Retirement In post-divorce modifications, financial analysis can be a significant tool in helping support your case to determine whether spousal support should continue, decrease, or end. A thorough evaluation of the income, expenses, and assets of both parties can be an important step in making a case for spousal support changes. For example, in a recent case that was conducted for a post-decree matter, a financial analysis was performed and detailed multiple scenarios, including how the recipient’s assets and Social Security benefits would support them over time. The analysis also factored in whether certain assets should be included, such as property that was designated for their adult children’s use or funds set aside for the payor’s current spouse. After adjusting for these factors, the court determined that the recipient needed to continue the financial support, and the maintenance order did not change even though the payor retired at the age of 67 years old Looking Ahead Spousal support and retirement are connected, and planning ahead can make the process smoother for both parties. Addressing potential retirement in the initial divorce agreement is preferred in many cases of later-life divorce if a reasonable agreement can be made that can reduce the likelihood of disputes later. A well-documented financial analysis can provide clarity and support for fair outcomes when modifications are requested. While every case is unique, being informed about the financial and legal considerations can help both payors and recipients navigate these potential changes with greater clarity and confidence. That’s where I come in. As a CDFA, I provide a comprehensive financial analysis tailored to your situation, helping you understand the long-term impact of different scenarios. Whether you're negotiating spousal support during a divorce or seeking a fair modification post-retirement, my expertise can help give you the clarity and data needed to make informed decisions. Schedule your free consultation today.", "author" : { "@type" : "Person", "name" : "Amy Mahlen", "sameAs" : "", "url" : "https://amf-divorce.com/our-blog/author/amy-mahlen" }, "dateModified" : "02/04/2025", "datePublished" : "02/04/2025", "headline" : "How to Handle Spousal Support When the Payor Retires", "image" : { "@type" : "ImageObject", "height" : 400, "url" : "https://39875594.fs1.hubspotusercontent-na1.net/hubfs/39875594/Imported_Blog_Media/qtq80-TPHjzr.jpeg", "width" : 750 }, "mainEntityOfPage" : "https://amf-divorce.com/our-blog/how-to-handle-spousal-support-when-the-payor-retires", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "" }, "name" : "A.M. Financial", "url" : "amf-divorce.com" } } ``` ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "articleBody" : "As a financial professional who often works with clients navigating the financial complexities of divorce, I’m always looking for ways to help families manage the process more effectively. One significant development in Colorado is the introduction of “Licensed Legal Paraprofessionals” (LLPs), a new profession designed to make divorce and other legal matters more accessible and affordable for families with less complex cases. First introduced as a new legal occupation designation in 2024, working with an LLP could significantly help couples looking to reduce legal fees while still receiving essential support during their divorce. In this post, we answer your top questions about LLPs and help you decide if they might be a good fit for your situation. What Are Licensed Legal Professionals? Licensed Legal Professionals (LLPs), also known as Licensed Legal Paraprofessionals, are non-attorney legal professionals trained and authorized to handle specific legal tasks for individuals navigating family law matters. They fill a critical gap in the legal system by providing more affordable legal assistance while maintaining a high standard of professionalism. To ensure LLPs are qualified to assist clients, Colorado has implemented rigorous standards, including: Education: Specialized training focused on family law and coursework to gain practical experience. Experience: Over 1500 hours of experience working as a paralegal, including 500 hours in the area of family law. Testing: A professional exam that demonstrates knowledge of Colorado law. Ethics and Oversight: Adherence to strict ethical guidelines and ongoing oversight by the state government. What Can LLPs Do? LLPs are authorized to perform many of the same tasks that attorneys handle in family law cases. This includes: Preparing and filing legal documents (e.g., divorce petitions, parenting plans). Providing legal advice within their authorized scope. Assisting with negotiations and mediations. Helping clients understand their rights and obligations. Support cases that involve child custody and visitation, child support, paternity, and the modification or enforcement of orders. What are the limitations of LLPs? While LLPs can provide significant support, there are limitations to their scope of practice. For example, they cannot: Represent clients in court, although they can sit with their clients in the courtroom and advise them. Handle highly complex cases, such as those involving significant assets, contested custody disputes, or allegations of abuse. Provide legal services outside their specific area of authorization. If your divorce involves high-conflict issues, complex financial arrangements, or requires litigation, you’ll still need the expertise of an experienced attorney. Who might benefit from working with an LLP? LLPs are an excellent fit for couples who have: Are pursuing an amicable or uncontested divorce. Have relatively straightforward finances. Agree on custody arrangements, child support, parenting plans, and spousal maintenance. Agree on key issues like property division or have very little property to divide. Want to minimize legal costs while receiving professional guidance. By working with an LLP, parties can resolve their divorce more efficiently and allocate saved resources toward their new financial futures. How do LLPs help a divorcing couple’s finances? Divorce is not just an emotional journey; it’s also a financial one. As a financial professional, I’ve seen how high legal fees can deplete resources that could otherwise go toward retirement, education, or rebuilding post-divorce. By making legal support more accessible, LLPs can help families navigate the process and minimize unnecessary financial strain. However, it’s important to remember that cost savings shouldn’t come at the expense of proper legal or financial planning. Even if you work with an LLP, consider consulting with a Certified Divorce Financial Analyst (CDFA) to ensure that your financial decisions are informed and aligned with your long-term goals. Introducing Licensed Legal Paraprofessionals in Colorado represents a step toward a more equitable legal system for all income classes. If you’re considering divorce and think an LLP might be beneficial in guiding your situation, visit the State of Colorado website to learn more about how LLPs might address your legal needs. Divorce is never easy, but with the right support, both legal and financial, you can navigate the process with confidence and clarity. As a financial professional, I can assist in planning, preparing for mediation/negotiations, or reviewing agreements alongside an LLP. If you’re preparing for divorce and need help understanding the financial implications, reach out today. I’m here to help you build a solid financial future so you can thrive in the next phase of your life.", "author" : { "@type" : "Person", "name" : "Amy Mahlen", "sameAs" : "", "url" : "https://amf-divorce.com/our-blog/author/amy-mahlen" }, "dateModified" : "05/02/2025", "datePublished" : "05/02/2025", "headline" : "Licensed Legal Professionals: A Cost-Effective Option for Non-Complex Divorces in Colorado", "image" : { "@type" : "ImageObject", "height" : 400, "url" : "https://39875594.fs1.hubspotusercontent-na1.net/hubfs/39875594/Imported_Blog_Media/qtq80-0S8mGj.jpeg", "width" : 750 }, "mainEntityOfPage" : "https://amf-divorce.com/our-blog/licensed-legal-professionals-a-cost-effective-option-for-non-complex-divorces-in-colorado", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "" }, "name" : "A.M. Financial", "url" : "amf-divorce.com" } } ``` ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "articleBody" : "Navigating the financial complexities of divorce can be one of the most challenging aspects of the whole process. This is especially true in high-conflict cases, where disagreements over financial matters can escalate to court proceedings. As a Certified Divorce Financial Analyst (CDFA), my role is not only to provide support to clients during the divorce process but also to equip attorneys with expert analysis and testimony that strengthens their case. In this blog, we’ll discuss how expert financial services can support clients and attorneys, particularly in high-conflict situations. Providing Expert Analysis and Testimony In cases where litigation is inevitable, attorneys need sound financial evidence to present to judges. This is where expert reports and testimony come into play. Some of the following are examples of assistance : Evaluating post-decree scenarios for spousal support termination: Assessing the financial implications of terminating spousal support at the payor's retirement, considering factors like Social Security timing, future financial stability of each party, among other factors. Assess post decree evaluations surrounding gains and losses attributable to asset division. Evaluating post decree financial review to determine the likelihood of undisclosed assets during initial divorce proceedings. Valuing separate property and pension benefits: Establishing fair valuations to avoid ambiguous asset division. Analyzing annuity structures and benefits: Determining how annuities division limitations and impact to overall financial impact to each party post divorce. Expert insights can add to a compelling attorney narrative and help legal teams better advocate for their clients. Many judges and magistrates will require analysis from a financial expert in order to substantiate financial claims. Being a Partner in High-Conflict Cases Attorneys are increasingly encountering high-conflict divorces where financial disputes take center stage. Partnering with a CDFA ensures that attorneys have the financial expertise needed to navigate these challenges. Whether it’s delivering an expert report, providing testimony, or working directly with clients to evaluate their financial options before heading to an expensive court trial, my goal is to provide transparency and help clients feel more confidence during the divorce process. In high-conflict divorce cases, every financial detail matters. Attorneys and clients benefit greatly from having a CDFA on their team, a professional who can deliver comprehensive financial analyses and testify as an expert when necessary. In addition, clients gain peace of mind knowing that their financial future is in capable hands. If you’re an attorney handling high-conflict cases, let’s discuss how I can support your team and your clients through expert analysis and testimony. Together, we can ensure that every financial detail is accounted for, paving the way for a more equitable resolution.", "author" : { "@type" : "Person", "name" : "Amy Mahlen", "sameAs" : "", "url" : "https://amf-divorce.com/our-blog/author/amy-mahlen" }, "dateModified" : "02/01/2025", "datePublished" : "02/01/2025", "headline" : "Empowering Clients and Attorneys in High-Conflict Divorce Cases: The Role of a CDFA", "image" : { "@type" : "ImageObject", "height" : 400, "url" : "https://39875594.fs1.hubspotusercontent-na1.net/hubfs/39875594/Imported_Blog_Media/qtq80-jPmFyp-2048x1365.jpeg", "width" : 750 }, "mainEntityOfPage" : "https://amf-divorce.com/our-blog/empowering-clients-and-attorneys-in-high-conflict-divorce-cases-the-role-of-a-cdfa", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "" }, "name" : "A.M. Financial", "url" : "amf-divorce.com" } } ``` ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "articleBody" : "Going through a divorce is emotionally taxing on its own, but when the holidays are added to the mix, the challenges intensify. The season that's meant for celebration can quickly become overwhelming, leaving you juggling family commitments, legal preparation, and financial stress. However, with careful planning and smart financial decisions, you can set yourself up for greater stability and start the new year on the right foot. In this post, we’ll explore practical tips to help you prepare financially for divorce, all while managing holiday obligations. Assess Your Current Financial Situation One of the first steps to preparing for divorce is understanding where you stand financially. Take stock of your assets, debts, bank balances, credit card accounts, and loans. Knowing your financial baseline will help you understand the financial decisions you need to make in both the short and long term. Divorce is a complex process; start thinking about the professionals you’ll need to guide you. A Certified Divorce Financial Analyst (CDFA) can help you create a solid financial strategy that aligns with your goals during and after divorce. They can assist in managing everything from asset division to long-term financial planning, helping you prepare for a secure financial future. Create a Holiday Budget Divorce often requires a reassessment of your financial priorities, and the holiday season is no exception. With legal fees and upcoming changes to your household income, it’s important to adjust your expectations and create a holiday budget that reflects your current circumstances. Consider aligning with your spouse on holiday spending, if possible. This can minimize conflict and ensure you don’t overspend due to emotional triggers. Focus on prioritizing essential expenses—gifts for children and basic holiday meals—while cutting back on non-essential spending such as lavish parties or unnecessary travel. To help you stay on track, use a budgeting app to monitor your purchases and ensure you stick to the plan. Be mindful of emotional spending during this time. It’s easy to justify splurging on gifts or activities to make up for the emotional strain your children (or you) might be feeling. However, this can lead to further financial stress. Stay disciplined and look for low-cost or free alternatives to create meaningful holiday experiences, like spending quality time together or organizing simple, family-friendly activities. Protect Your Credit Credit will impact your financial independence after the divorce, especially if you’re planning to buy a new home or car. During the holidays, keep a close watch on your bank and joint accounts, particularly as seasonal spending increases. Joint credit cards and lines of credit can be problematic during a divorce, as both parties are responsible for any debts incurred. If possible, consider closing or freezing joint accounts to avoid future liabilities. This step can help you gain greater control over your finances and prevent unexpected charges. Freezing accounts if preferred because, in some cases, closing accounts can hurt your credit score. Regularly monitor your credit score during this time. Make sure there are no surprise purchases that could negatively impact your credit standing, especially when emotions are running high. Protecting your credit now will make a significant difference when you begin your post-divorce financial life. Consider the Tax Implications of Your Divorce Timeline Taxes may not be the first thing on your mind during the holidays, but they play a vital role in your divorce planning. The timing of your divorce can have a major impact on your tax obligations. You might be wondering whether you file jointly for the current year, or separately, and how alimony or child support will affect your taxes. It’s a good idea to consult with both financial and tax professionals before the year ends. They can help you assess your tax situation and guide you on the best course of action. Early planning will allow you to avoid any unpleasant surprises when tax season arrives, making the transition to your post-divorce life smoother. Plan for Your Financial Future The holidays are a time for reflection and new beginnings, and this can also apply to your financial future. Start thinking about your short- and long-term financial goals. Rebuilding savings, reassessing retirement plans, and setting new budget priorities are key steps to ensure a financially secure life post-divorce. Now is also the time to establish independent credit, if you haven’t already. Understanding your current credit score and finding ways to build or improve it will make your transition smoother. Looking ahead, consider how you’ll manage holiday expenses in future years. Start putting money into a fund throughout the year to cover seasonal costs, allowing you to celebrate without overspending. Reimagine holiday traditions to reflect your new financial reality, setting expectations that align with your post-divorce life. The holidays will look different when you’re preparing for a divorce, and it’s important to acknowledge the unique challenges you’re facing. By taking control of your financial situation and making smart decisions now, you’ll reduce some of the stress that comes with this major life transition. Proactive financial planning will allow you to enter the new year, and your new life, with greater clarity and confidence. Take the time to assess, adjust, and plan so that you can focus on what really matters during the holiday season—your well-being and the well-being of your loved ones. Contact us with your financial questions during this time of transition.", "author" : { "@type" : "Person", "name" : "Amy Mahlen", "sameAs" : "", "url" : "https://amf-divorce.com/our-blog/author/amy-mahlen" }, "dateModified" : "04/11/2024", "datePublished" : "04/11/2024", "headline" : "Preparing for Divorce During the Holidays: Making Smart Financial Decisions", "image" : { "@type" : "ImageObject", "height" : 400, "url" : "https://39875594.fs1.hubspotusercontent-na1.net/hubfs/39875594/Imported_Blog_Media/qtq80-dRzF37-300x200.jpeg", "width" : 750 }, "mainEntityOfPage" : "https://amf-divorce.com/our-blog/preparing-for-divorce-during-the-holidays-making-smart-financial-decisions", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "" }, "name" : "A.M. Financial", "url" : "amf-divorce.com" } } ``` ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "articleBody" : "If you're a divorced parent or currently going through a divorce, the college application process can be particularly confusing. Applying for colleges, scholarships, and financial aid is complicated enough, and the recent changes to the Free Application for Federal Student Aid (FAFSA) have added new challenges. In this post, we’ll break down the latest updates and provide clarity on how these changes may affect your financial planning for your child's education. What is the FAFSA? The Free Application for Federal Student Aid (FAFSA) is a form that students and parents across the United States fill out to determine their eligibility for student financial aid. This aid includes federal grants, work-study, tuition-free college, and loans. It's a crucial step in securing financial support for college. What’s Recently Changed About the FAFSA? Starting with the 2024-25 award year, significant changes have been made to how divorced or separated parents report their information on the FAFSA. Previously, the parent with the most overnights was responsible for completing the FAFSA. However, this is no longer the case. Here's what you need to know: Step 1: Determining the Parent of Record The primary criterion for determining which parent completes the FAFSA has shifted from living arrangements to financial support. The parent who provides the most financial support over the 12 months prior to filing the FAFSA is now the parent of record, regardless of where the student lives. Specifically, the “parent of record” is the individual who provided more than 50% of the student's financial support in the past year, even if the student does not live with that parent. If neither parent provided support in the 12 months prior to filing the FAFSA, the “parent of record” is the parent who provided greater support during the most recent year that the student received financial support from a parent. The official “parent of record” is self-reported on the FAFSA. Schools typically will not verify this unless there is conflicting information. Child Support Considerations Child support payments play a crucial role in determining the “parent of record”. For example, if the mother pays child support to the father, this amount is considered part of the mother’s financial support for the student. If this, combined with other support, exceeds 50% of the total support for the student, the mother becomes the “parent of record” on the FAFSA. Step 2: Provide Financial Information to FAFSA The parent of record will provide their information on the FAFSA forms. If both parents provide equal amount of support, the parent with the higher income and assets will report their financial information. Remarried Parents If the parent of record has remarried, the new spouse's income and assets must be included in the FAFSA calculations for the “parent of record” during Step 2. This can be significant because it can have a profound effect on the financial picture and ultimately the amount of aid the student is eligible to receive. During Step 1, only the biological parents' financial contributions to the child are considered when determining the “parent of record” and the new spouse’s income is only relevant after that determination has been made. The “parent of record” is determined by looking only at each individual biological parent’s financial support without regard to any stepparent's income or support. After that determination is made, if the “parent of record” is remarried, the spouse’s/stepparent’s income and assets are included on the FAFSA. In a scenario where both of the biological parents have remarried, the new spouse’s/stepparent’s support is not included when determining the “parent of record”, but the new spouse of the “parent of record” is included on the FAFSA. How Does This Impact You as a Divorced Parent? Potential Reduction in Financial Aid Most likely the higher earner is now required to fill out the FAFSA, and therefore there’s a possibility that your child may qualify for less financial aid. This change is particularly impactful if the higher-earning parent is not the one the child lives with primarily, or has fewer overnights. Cooperation Between Parents The need for the higher-earning parent to complete the FAFSA can introduce challenges, especially if the relationship between the divorced parents is strained. Ensuring that this parent cooperates and provides the necessary financial information on time is crucial for the financial aid process. Individuals and family law attorneys may want to include provisions in divorce agreements stating that the parties agree to work together and provide required financial information needed for their child’s college financial aid process. Strategic Financial Planning Given these changes, strategic financial planning becomes even more important. Here are some steps you can take: Early Communication: Start discussions with your ex-spouse well before the FAFSA filing deadline to ensure all required information is gathered. Fill out the application as early as possible. Consult a Financial Planner: A professional can help you understand how these changes impact your specific situation and offer strategies to maximize your child’s financial aid and tuition free college eligibility. Review Financial Contributions: Keep detailed records of financial contributions to help with accurate reporting on the FAFSA. Navigating the FAFSA as a divorced parent has always had its complexities, but understanding the recent changes can help you better prepare and plan for your child's education expenses. The shift to considering financial support over living arrangements means that both parents need to communicate and cooperate more effectively. By staying informed and proactive, you can help ensure that your child receives the financial support they need for their college journey. For more detailed guidance and personalized advice, don’t hesitate to reach out to a financial planner who can assist you in navigating these changes. More information about Colorado’s tuition-free College Options can be found here.", "author" : { "@type" : "Person", "name" : "Amy Mahlen", "sameAs" : "", "url" : "https://amf-divorce.com/our-blog/author/amy-mahlen" }, "dateModified" : "08/07/2024", "datePublished" : "08/07/2024", "headline" : "FAFSA Changes for Divorced Parents: What You Need to Know", "image" : { "@type" : "ImageObject", "height" : 400, "url" : "https://39875594.fs1.hubspotusercontent-na1.net/hubfs/39875594/Imported_Blog_Media/qtq80-oBtQaY-2048x1365-1.jpeg", "width" : 750 }, "mainEntityOfPage" : "https://amf-divorce.com/our-blog/fafsa-changes-for-divorced-parents-what-you-need-to-know", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "" }, "name" : "A.M. Financial", "url" : "amf-divorce.com" } } ```