3 Things I Wish I Could Tell Mediation Clients

Part of the challenge of being a divorce mediator is watching people make decisions that are not necessarily in their best interest.

You see we in the mediation profession believe in the principle of self-determination. Supporting clients to make decisions that they feel are best for them in their situation. Because who knows what’s best for them than… well them?

But even though that may be the case and we take a more “hands-off” approach, don’t think we’re just potted plants. Waiting for the next ray of sunshine. We still have opinions. But unlike your friends and family, we just don’t share them.

Unless, of course, we happen to be writing a blog post!

As each case is unique, I’m sure there are other things I’d like to share from time to time depending on the situation.  But the issues presented below are the 3 most common ones that I see pop up while working with mediation clients and have to tread lightly when discussing it with them.

Issue #1: Think Through Keeping the House VERY Carefully

When it comes to dividing a couples assets and liabilities, the marital home is usually the biggest one they’ve got. So it’s no wonder that lots of thought goes into the decision to keep it.

Or does it?

The fact is most clients I work with who have children think keeping the house is a foregone conclusion. And nothing could be further from the truth.

Certainly the idea of keeping the house for the sake of the kids is a noble one.  Maybe it’s the only house they’ve even known. Maybe all their friends are on the block. Or you think they’d never forgive you if you moved.

The reality is houses cost more than just their monthly mortgage payment and utilities. Houses require work. Major work. And it’s expensive. So just because your house doesn’t need a roof today, it doesn’t mean it won’t soon.

Boilers break. Windows leak. Driveways crack. All unexpectedly. Think through the real cost of home ownership before deciding if you’re going to keep or sell the house. It may wind up costing you far too much financially and emotionally to stay there.

Issue #2: Alimony Shouldn’t Be Your Sole Source of Income

Perhaps you’ve stayed at home with the children for the duration of your marriage and think you have no marketable skills. So you’ll rely on financial support from your soon-to-be-ex as your means of survival.

Big mistake.

Even though alimony can be mandated by decree, it doesn’t mean it’s carved in stone and not subject to change. Especially in this economy, I’ve seen spouses go from making $1 million a year or more to making $60,000 within a year. Lose that big job, and with it, down goes the alimony.

And not to be morbid here but while life insurance is typically taken out by the spouse paying alimony to cover their obligation should they die before their obligation is satisfied, what about if they’re disabled? Now they can’t work (no income may mean no alimony for you) and they aren’t dead (not dead = no life insurance payout for you) so as the recipient, you are left without a source of income.

Even if it’s something small, try to get a job or go back to school. Alimony will most likely end one day and sometimes much sooner than you think.

Issue #3: Not Asking for a Portion of the Retirement Accounts

There’s a thought out there it seems that if one person worked to earn a 401k, that the other person doesn’t share in those savings.

To be clear – if the asset was earned during the marriage, it is considered marital property (at least in the States of Illinois and New Jersey where we practice) and thus subject to division.

Typically the party who has been working has been doing so for far longer than the party who has stayed home to raise the children as their caretaker. Once the caretaker returns to the workforce, they’re going to have a difficult time “catching up” on their retirement savings. Most of the money earned is going to go right back into living expenses for the here and now. Not for saving for a rainy day.

If you were to stay married until you both retired, of course you’d share in the retirement accounts. So the same logic applies when divorcing. Divide the portion earned during the marriage and go your separate ways.

You may feel guilty asking for it now but you’ll be happy you did later when you’re 75 and can afford a place to live!

In Conclusion

While every case is unique and you have to make the decisions that are best for you, during a divorce is not the time to be meek.

Be cooperative, be fair, be kind and be adults. But don’t feel guilty for wanting to secure your financial future.

If you don’t watch out for it, no one else will.