Divorce via spreadsheet

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divorce-spreadsheetIT is hard to see the fruits of a marriage detailed on a spreadsheet, but it is the only way to separate fact from emotion during a divorce, financial experts and family court lawyers say.

An economic model designed to take the pain out of dividing assets was unveiled by financial journalist Paul Clitheroe and financial adviser Jane Campbell at the National Family Law Conference in Hobart yesterday.

“Money is the big tensions issue,” Mr Clitheroe said.

“With more communication and decent advice it doesn’t have to be the bomb that goes off.”

Ms Campbell said the Life Choices tool was an accurate and fair way to divide assets.

Details on bank accounts, credit cards, shares, mortgages, age and life expectancy are fed into the model which estimates the future value of assets.

“You might think it is fair to split the assets 50:50, but if one partner gets the super and shares and the other the house, the super and shares may be worth a lot more in the future than the house, and it may be more fair to divide 40:60,” Ms Campbell said.

Financial advisers also help newly separated clients with budgets to live within their means.

Ms Campbell said superannuation and housing were two of the biggest assets at stake in a divorce.

Lawyers worked with a statistic led financial planning firm, ipac, to develop the tool that attempts to guide couples going through a divorce in the complicated process of the division of assets.

“We understand that from the lawyers’ perspective, that the delivery of an accurate financial statement is one of the issues creating a financial settlement logjam,” explained Jane Campbell, Law Sector manager at ipac and who was part of the presenting panel. The model is designed to help couples separate fact from emotion in the process and assists in the delivery of an accurate financial statement from the outset.

The model can also help individuals understand the implicit costs of a delayed settlement because assets were kept frozen in a legal account while proceedings were still being finalised.

Law Council family law chair Geoffrey Sinclair said younger people were more financially literate than many older clients.

“We find older clients who have relied on their partners being in control, all of a sudden, bang, the credit card is cut off and they have no access to funds, they’ve never had their own bank account and they’ve never had to budget,” Mr Sinclair said.

The community perception that lawyers were the only people to benefit from a divorce was unfair.

Most family lawyers want to help and inform people who have no idea about their rights.

“We help resolve disputes, we are not bloodsuckers,” Mr Sinclair said.

 

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Categories: Divorce, Economic Model, Financial Dispute
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