Barbara DiamondDivorce is not the best time...

Barbara Diamond

Divorce is not the best time in the world to deal with money issues

but it may be the most crucial, according to Violet P. Woodhouse, who

wrote the book on how to break up a marriage without breaking the

bank.

“Communicate, negotiate and compromise,” Woodhouse said. “The same

things that make a successful marriage will make a successful

divorce.”

The Laguna Beach resident is an attorney certified as a family law

specialist, a certified financial planner, a registered investment

advisor and author of “Divorce and Money: How to Make the Best

Financial Decisions During Divorce,” first published in 1991 while

she still attending law school.

A revised edition of the book recently was released. It includes a

new chapter on employee benefits and how they figure in a divorce.

“The revision was important because most people going through a

divorce have employee benefits,” said Woodhouse.

It is no longer just tangible assets such as a home, a savings

account or paycheck that have to be taken into consideration when

couples divorce. Medical insurance or life insurance, pension plans,

deferred compensation recently have emerged as a factor in financial

planning.

“Couples involved in a divorce are realizing there is a

significant value in assessing employee benefits,” Woodhouse said.

Her book explains benefits and how they will affect divorce

settlements. The question most often at issue is whether the benefit

is considered taxable income.

“A successful divorce leaves you with your dignity intact and, if

there are children, allows parents to co-parent,” Woodhouse said. “If

people communicate, negotiate and compromise, they will get through

the process and they will save enormously in attorney’s fees.”

However, divorce is generally not the best time to start

discussing money issues, Woodhouse opined.

Common mistakes made by married couples are not talking about

finances and not sharing responsibility, including the preparation of

income tax returns.

“That is an opportunity for both parties to learn what is going

on,” she said.

Another big mistake is not being accountable.

“No one wants to expound on how much they have spent or what they

have spent it on,” Woodhouse said. “We don’t want anyone to judge us,

but that is not conducive to a partnership.”

And it is a BIG mistake to assume you have no responsibility for a

partner’s financial conduct, which could include payment of taxes,

gambling and credit card spending.

“Then they wonder when they get a divorce why they have no

assets,” Woodhouse said. “They lived well, but they were really

loaded with debt.”

Pre-nuptial agreements are an effort to avoid open warfare during

divorce.

“But circumstances change,” Woodhouse said. “The couple’s

financial position improves dramatically or they might move to

another state.”

Divorce laws differ from state to state.

“California is a community property state that recognizes that

generally all assets acquired during a marriage are community

property,”

Woodhouse said. “The courts are mandated to divide the assets

equally and fairly. Those are inconsistent terms.

“Fair is often times a perception. Some intrinsic value may be

more important to one person than to another.”

The principal of community property values the services of both

parties to the marriage, according to Woodhouse. A homemaker is

equally valued as the wage earner.

“That is absolutely right,” Woodhouse said. “Let’s not get into

who made the money.”

And with benefits being looked at in the light of their value to

divorcing couples, the weekly paycheck no longer the only thing to

figure when calculating just how much child support or alimony you

will get or you will owe, Woodhouse said.

Employee benefits are upping the ante. What is the value of

medical insurance or life insurance, pension plans, deferred

compensation?

Benefits are not just for the likes of John F. Welch, a former

General Electric Co. executive whose divorce papers alleged his

retirement package included access to an apartment valued at $80,000

a month, food, wine, laundry and other living expenses, satellite TV,

seats to the U. S. Open tennis tournament and more, according to

Woodhouse.

“Some people with nothing can have very complex issues,” Woodhouse

said. “The more complex the issues, the more valuable are the

services of a financial planner.”

Woodhouse has been named by Worth Magazine as one of the top 200

financial planners in the country for all five years since the list’s

inception

Her expertise comes into play when a couple is contemplating

divorce or is ready to negotiate terms. They should be prepared for

differences in negotiating style.

“Men are very direct: they want to get to the issue and fix it or

resolve it.” Woodhouse said. “Women want to talk about it.

“This is really about evolution. Women are the nurturers, the

nesters. Man’s primary purpose was to spread DNA.”

Woodhouse offers her advice in written and oral forms. She

appeared on the Cox Forum March 6. An interview on radio station KSBR

can be heard at 7:30 p.m., April 7. An interview she will tape

Tuesday at KDOC, does not yet have an air date.

Her book is available at Amazon.com, Barnes & Noble and Borders.

The cost is $34.99.

For more information, contact Web site www.violetwoodhouse.com

* BARBARA DIAMOND is a reporter for the Laguna Beach Coastline

Pilot. She may be reached at 494-4321.