A divorce in Arizona requires both people to divide their financial lives so that they can move forward as single people. Your final divorce settlement will specify your division of property and support payments, if applicable. A Certified Divorce Financial Analyst (CDFA) helps you understand your financial position and make appropriate choices for your future as you negotiate your divorce. The assistance of a CDFA could result in a fair and equitable resolution that eases the financial strain that can accompany the division of assets and income.
Specialized financial guidance
A CDFA has training and experience directly applicable to the divorce process. This differs from your typical financial adviser who prepares investment strategies to meet your goals.
A CDFA focuses on:
- Finding your best options for property division
- Planning your budget as a single household
- Informing you of the tax consequences of the divorce
What a CDFA analyzes
Your CDFA looks at the short-term and long-term financial issues relevant to your divorce. This professional examines:
- Asset ownership and valuation
- Calculation of child or spousal support
- Retirement accounts
- Household budget
- Health insurance costs
- Life insurance needs
An analysis conducted by a CDFA can establish whether assets are owned jointly or separately. This information lets you know what assets will be subject to division. The liquidity or illiquidity of assets influences your decisions as well. You may need to liquidate some assets or, if that is not feasible, account for their value in other ways.
Budgeting and taxation
The report generated by your CDFA brings clarity to issues about how to cover your expenses as a single-income household. This information gives you a clear picture of what your future income needs to be.
Your divorce could alter your income taxes as well. Certain choices, like cashing out a 401(k) account, can result in a big tax bill right after the divorce. A CDFA may propose solutions that control tax consequences or prevent you from making a choice that produces an unexpected tax debt.