Publishedby:

JulieGentiliArmbrustMediationNorthwest911CountryClubRoadEugene,OR97401

Telephone:541.484.1200Email:Info@MediationNorthwest.com

www.MediationNorthwest.com

©2019byJulieGentiliArmbrust,AttorneyatLawAllRightsReserved.

ISBN:978-1-54396-440-0(print)ISBN:978-1-54396-441-7(ebook)

ThisiscopyrightedmaterialandmayonlybereproducedwithpermissionfromJulieGentiliArmbrust,withtheexceptionofshortquotesforbookreviews.

ACKNOWLEDGEMENTSI want to thank my wonderful husband, amazing children, and

adorablepuppiesforacceptingme,bigcurlyhairandall.Youremindmeonadailybasisthatlifeisaboutcuddlesandkisses!Iamblessedtocallyoumyfamily.

TABLEOFCONTENTS

1.Introduction&Disclaimer1

2.WhatIfIDon’tWanttoGetaDivorce?3

3.HowtoGetaDivorceinOregon5

4.WhatAbouttheKids?11

5.HowtoDivideItUp27

6.HowtoPayforYourLifeAftertheDivorce53

7.ThingsYouMayNotHaveConsidered67

8.MediationDo’sandDon’ts75

9.AbouttheAuthor83

This,too,shallpass…

1.

INTRODUCTION&DISCLAIMER

For those who need a gladiator of peace to lead you through thefierypathofadivorce,thisbookisforyou.Thisbookiswrittenforthevastmajorityofdivorcingcouples inOregon. I assume that ifyouarereadingthisbook,youwereeithermarriedinOregonoryouhavelivedinOregonforatleastsixmonths.

Ifyouareeitheramemberofthemilitaryoradebtorinanactivebankruptcy,youneedtoseekadditionallegaladvice.

Forallreadersofthisbook,Iamnotyourattorneyandthisbookisnotintendedtoprovideyouwithlegaladvice.Ifyouneedlegaladvice,pleasegoseeanattorney.

Of course, there will always be exceptions this book cannotanticipate.Thatsaid,mostcouplesIencounterfallwithinthebullseyeofthisbook.Attimes,thelawdescribedinthisbookhasbeensimplifiedtobestcommunicatethemostlikelyscenario.

Many times in thisbook,butparticularly in the sections related tochildren, I discuss psychological impacts to children. I am not atherapist. My suggestions are based upon the thousands of couples Ihave interacted with and innumerable studies by psychiatrists orpsychologists.If theinformationwasn’tpractical,didn’tpassthesmelltest,ordidn’tworkformyclients,Ididn’tincludeitinthisbook.Thisbookisbaseduponpracticalinformationthatworksformyclients.

Iusetheterms“husband”and“wife”because95%ofmyclientsarehusbands and wives. I am sure that percentage will change now thatsame-sexcouplescanlegallymarryandlegallydivorce.Theinformationinthisbookpertainstoallmarriedindividuals,regardlessofgender.

Ibelieveinthepowerofinformation.Ifyouareinformed,youhavetheopportunitytomaketherightdecisionforyouandyourfamily.

This book is designed to allow you to chapter-flip to the sectionsyouneedtoknow.Isuggestyoureadeachchapter,buteachchapterisdesignedtostandonitsown.

Let’sgettoit!

2.

WHATIFIDON’TWANTTOGETADIVORCE?

Divorce is difficult. It is infinitelymore difficultwhen it is beingforceduponyou.InOregon,ittakestwo“Ido’s”toagreetoamarriage,butonlyone“Idon’t”toendamarriage.So,theharshrealityisthatifonepartywantsadivorce,itisgoingtohappen.

Thedivorcemaynotbeyourchoice,butthetermsofthedivorceareyourchoice.Thiswillbeoneofthemostdifficulttimesinyourlife.Itwillbedifficulttoconcentrateonanythingbeyondsurviving.Scheduletime to learnhow thisdivorcewill impactyour life.Twochaptersperweek for one month, and you will be informed enough to makedecisions. You owe it to yourself to educate yourself and take backcontrolofyourlife.

Ifyouareinasituationwhereyourspouseadvisesyous/hewantsadivorce,thenyouhavetwochoices:

The termsof thedivorceandyour lifeare imposeduponyou,or

Youchoosethetermsofthedivorceandthepathofyournewlife.

3.

HOWTOGETADIVORCEINOREGON

TherearefourdifferentwaystoachieveadivorceinOregon.Eachoption has advantages and disadvantages, and no single option isappropriateforeveryone.Mystressfoodofchoiceisacupcake.Forthischapter, I recommend peeling back the cupcake liner and taking onebite.Thisisaquickchapter.

Forms

TheOregonJudicialDepartmenthasmany,manyformsthatallowyoutoobtainadivorcewithoutattorneys.Theadvantagetousingtheseformsisthattheyarefree.Thecleardisadvantagetousingtheseformsisthat you aren’t an attorney, and you could unknowingly createsignificantlegalproblems.Also,theseformsarenotregularlyupdated.

When I was a baby attorney, I made quite a bit of money fixingsituations unintentionally and unknowingly created by these forms. Ifyou understand the law and what particular clauses mean and do notmean, then the use of these forms is a legitimate choice for you.Attorneysearnadoctorateinthelawtoknowhowthelawinteractswithsituations. If you have assets, liabilities, or children, and you do notknowthelaw,usingtheseformscouldhaveasignificantimpactonyou.

OnePartyHiresanAttorney

Anotheroption is thatonepartycouldhireanattorney.Whenoneparty hires an attorney, that one party is represented by that attorney,whichmeans that theattorney’sethicalobligation is to lookafteronlythat oneparty. I cannot emphasize this enough:Only one party’s bestinterests will be looked after when only one attorney is hired. Theadvantageofthisoptionisthatyouhavethelegaladviceofanattorney.Thedisadvantagetothisoptionisthattheunrepresentedpartyisatthemercyoftheotherpartyandtheattorney.

BothPartiesHireAttorneys

Bothpartiescouldhireattorneys.This is thesafestoptionbecauseattorneys represent both parties. Neither party needs to trust the otherparty.Thelegalnatureofthedivorcewillbeproperlyrepresented.Niceand safe.Asmy father says, “Super clean, jelly bean.”However, it isalsoshockinglyexpensive.A teacherandacityemployeecouldeasilyspend$20,000justtonegotiatethetermsoftheirdivorce…andthatisiftheysettledpriortotrial.Ifthepartiesgototrial,mostpartieswillbeginat$20,000each.EACH!

Mediation

Mediationisaprocesswhereamediatorguidesthepartiesthrougheach decision necessary to obtain a divorce. Although I am a divorcemediator, and thusclearlypartial tomediation, it isn’t the rightoptionforeveryone.Itis,however,therightoptionformost.

Mediationisagoodsolutionforparentstodiscusshowtoco-parentthe children. Mediation Northwest always puts children first in thedivorcemediationprocess.Childrenareourpriority,evenwhenparentsaccidentallylosesightoftheirbestinterests.

Somemediators are also attorneys. If you are selecting a divorcemediator,Icannotemphasizeenoughtoselectamediatorwhoisalsoanattorney(orsomeonewhohasgraduatedfromlawschool).Anattorney-mediator has the skillsand knowledge to get you to the goal line. Amediatorwhoisnotanattorneyhasn’tbeentrainedin thelawandcaneasily make mistakes that can cost you tens, or even hundreds, ofthousandsofdollars!Also,attorney-mediatorscandraft thedocumentsnecessary for your divorce. A non-attorneymediator can only draft amediation settlement agreement but cannot draft all the documentsnecessary to achieve a divorce. Which means that if you use a non-attorneymediator,you’llberequiredeither togotocourtonyourownandpresent to the judgeorhireanattorney todo so.Yuck! Itpays tochooseanattorney-mediator!

Not to further complicate your decision, but not all attorney-mediatorsareequal.InOregon,thereisnolicensingrequirementtocalloneselfamediator.Yes,myteenagesoncancallhimselfamediatorandnotbeinviolationofthelaw.So,ifanattorneycallshimselfamediator,he is legally accurate. However, that doesn’t mean he is really amediator. A divorce mediator has taken a minimum of 80 hours ofmediation training (a 40-hour basic mediation training and a 40-hourdivorcemediationtraining).

Mediationisalearnedskill-set.Youwouldn’thireanattorneywhoridesadeskalldaytolitigateyourcaseattrial.Similarly,youshouldn’thireanattorney-mediatorwhohasn’ttakenthenecessaryclassestolearn

how tomediate.A great divorcemediator is a trained neutral partyandknowshowtogetacasesettledinafairmannerforbothparties.

Amediator informs both parties of the areas necessary to discuss,plustheadvantagesanddisadvantagestoeachpossibledecision.Then,thepartiesdecidehowtoproceed.Ifadecisionisnoteasilymade,thenaskilledmediatorguidesthepartiesthroughthedecision-makingprocessuntilthepartiesmutuallyagree.

There are many advantages to using mediation with an attorney-mediator.Mediation is very cost-effective for the legal skill involved.Theaveragedivorcemediationcostsbetween$2,500and$5,500,whichmeans$1,250and$2,750perpersonandnoattorneysrackinguplegalbillsto$20,000perperson.

Mostimportantly,mediationassiststhepartiesintalkingthroughallmatters related to the children. Generally, parents who are getting adivorcehavedifferentideasofwhatisbestfortheirchildren.Havinganimpartial partymaking sure both parties’ voices are heard and reality-checkingbothparties ishelpful toensurea reasonabledecisioncanbemade in thebest interestsof thechildren.MediationNorthwestalwaysputschildrenfirstinthedivorceprocess.Childrenareourpriority,evenwhenparentsaccidentallylosesightoftheirbestinterests.

Mediation is awesome, but the process is not right for everyone.Youmustbeabletoeventuallymakedecisionswithyoursoon-to-beex-spouse. If your soon-to-be ex-spouse is irrational, cannot make

decisions,orcannotbetrustedtomaintaindecisions,thenmediationisagiantwasteoftime.

NextStep

ItisasafebettoassumethatifyouarereadingDivorceMediationinOregon,youareelectingtousemediationtodissolveyourmarriage.Thenextstepistounderstandeachandeveryaspectofyourdivorce:thechildren, the assets, the liabilities, the support, etc. Only once youunderstandthelawthatunderpinsdivorcecanyouthenunderstandhowtobestadvocateforyourselfinmediation.

Freebie

For a free “How toChoose aDivorceMediator” check-list, emailmeatinfo@MediationNorthwest.comandIwillemailittoyou.

4.

WHATABOUTTHEKIDS?

Donotskipthissectionifyouhaveminorchildren.Ifyoudonothaveminorchildren,haveacupcakeand

goontoChapter5.

First and foremost, let’s understand two very important conceptsaboutdivorcewithchildren:custodyandparentingtime.Thecontentsofthischaptercandramatically impactyourdivorce.Fullyunderstandingtheactualvs.theperceivedlegalramificationsofcustodyandparentingtimewillbethehardestpartofyourdivorce.

This is the time to forget the urbanmyths you’ve heard and notlisten to your co-worker’s nightmare divorce stories. Inevitably, thesestories are full of misunderstandings and information that is onlypartiallyaccuratebutincomplete.

Information is power, and the only way to take charge of yourdestiny is to arm yourself with information. I suggest either taking asecond bite of your cupcake or another sip of yourwine/beer becausethissectionwillbedifficultanditwilltestwhatyouthinkyouknow.

Custody

The partywho is awarded custody is the legal decision-maker forthechildreninfourdiscreteareas:residence,healthcare,education,andreligion.Ifthehusbandisawardedsolecustody,thenhe,andhealone,will make the decisions for the children’s residence, health care,education,andreligion.Ifhusbandandwifeagreetojointcustody,thenbothwifeandhusbandmustmutuallyagreeonthedecisionsinthefourdiscreteareas.

Here is the first kicker: A judge cannot force a party into a jointcustodyagreement.So,ifyouoryoursoon-to-beex-spousecannotagreeupon joint custody, it cannot happen. But joint custody doesn’t meanyouandyoursoon-to-beex-spousenecessarilygetalong.Itmeansyouand your soon-to-be ex-spouse can make decisions together aboutresidence,healthcare,education,andreligion.

Here is the second kicker: Case law practically nullifies thedecision-making ability of a sole custodian parent for residence. If aparentwith sole custodywants tomove toCalifornia, theotherparentcan simplypetition the court andask the court to intervene.Then, thecourt will need to make a determination of where the children willreside.So,the“residence”areaofsolecustodyisn’tnearlyasscaryorasimportantasitlooksatfirstglance.

Another urbanmyth is “legal custody” vs. “physical custody.” InOregon,thesetermsdonotexist.Youeitherhavesolecustodyorjointcustody.

Here is the take-away: If you and your spouse can make jointdecisionsin theareasofhealthcare,education,andreligion, thenjointcustodycanworkforyou.

ParentingTime

Parenting time is the physical time the children spend with eachparent.Ifthechildrenspendtimewitheachparentinaoneweekrotatingschedule,commonlydescribedas“everyotherweek,”thentheparentingtimewith the children is fifty percent to husband and fifty percent towife.

What does this mean in real life? Let’s use an example to bestillustratehowthedecisionforcustodyandparentingtimecouldaffect,orcouldnotaffect,yournewsituation.

ScenarioNumberOne

Ross has sole custody of the children.Even thoughRoss has solecustody,thechildrencouldspend70percentoftheirparentingtimewithRachel.Howcouldthathappen?Itcanhappenbecausethepersonwhoisbestsuited tomakedecisionsfor thechildren in the limitedareasofresidence, health care, education, and religion is not necessarily theperson with whom the children should spend most of their time. Forexample,RossandRacheleachfreelyadmittheycannotmakedecisions

together. Ross has always been the decision-maker of the family,whereasRachel,byherownadmission,doesn’tliketomakedecisions.However, Ross often travels for work and Rachel is a stay-at-homemom. It therefore makes sense for Ross to have sole custody of thechildren,butRachelshouldbeawardedmostoftheparentingtimewiththechildren.

ScenarioNumberTwo

Rachel andRoss agree to joint custody. Ross has the children 40percentofthetimeandRachelhasthechildren60percentofthetime.ThefamilyhasattendedFirstBaptistsincethechildrenwereborn.Rosshas decided he no longer believes in religion and doesn’t want thechildrentoattend,notjustonhistime,butonRachel’stime,too.Whathappens?

IfRossandRachelcannotmutuallyagreeuponreligion,thenoneofthree scenarios will occur. Either (1) Rachel continues to take thechildrentochurchduringherparentingtimeandRossremainsannoyed,(2)RosstakesRacheltocourt,ajudgeisthenforcedtograntRachelorRoss sole custody (a judge isn’t going to determine the children’sreligion— that is theparents’decision), andwhoever is awarded solecustody will determine the children’s religion or lack thereof, or (3)RossandRachelentermediationtofindasolutiontotheproblem.

ScenarioNumberThree

Rachel has sole custody. The children spend parenting time withboth parents in an every otherweek rotating schedule.Rachel hates itthat Ross feeds the kids either fast food or pre-cooked, heat-n-servedinners.EventhoughRachelhassolecustody,shedoesn’tgettocontrolthis decision because it is not one of the four discrete areas discussedabove.

SuggestionsforCustodyandParentingTime

MostpartiesmakeaHUGEmistakeandfightforsolecustodywhentheyactuallyagreeonthefourdiscretejointcustodyareas—theyjustdon’tagreeonhowtoparentthechildren(e.g.,bedtimes,foodchoices,activities, andsoon).Solecustody isnotgoing to fix thatproblem. Ifyouaresuperluckyatcourt,aparentmaybeawardedamajorityoftheparenting time. However, more and more judges are awarding 50/50parentingtimeunlessaparentisahorribleparent.(WhenIsayhorribleparent, I mean a drug-dealing, prostituting, abusive, horrible parent. Idon’tmeanaselfish,rude,andegomaniacal“horrible”person.)

Although judges routinely order 50/50 parenting time, I do notagree with 50/50 parenting time as a solution for all families. I seechildren the happiest when the parenting time schedule takes intoaccount each parent’swork schedules, the ages of the children,whichparent the children are most bonded with, and the distance to the

children’s school from the parents’ homes. Please see the “ParentingTimeOptions”sectionforadditionalinformation.

Hereisthetake-away:Aslongasyoursoon-to-beex-spouseisn’tacurrentdrugaddictor anabuser, abetter idea is towork thingsout inmediation by agreeing to joint custody to avoid the unnecessary fight,andfightabouttheparentingtime(i.e.,timespentwitheachparent)andtheparentingtimerules(bedtimes,mealchoices,etc.)thatarenearanddeartoyourheart.

I suggest re-reading this section. This is one area that, ifmisunderstood,cansignificantlyimpactyourdissolutioncosts,time,andoverallimpacttoyournewlifeandyourchildren’slives.

ParentingTimeOptions

Toddlers and teenagers are each in the same stage of growing up.Theyarepushingboundarieswhile,atthesametime,theyareinneedofstructure. That is why toddlers are described as being in the “terribletwos”andteenagers…well,usuallyit’sutteredwhileshakingone’sheadandmuttering,“Teenagers!”

Thevastmajorityof childrenneed frequent andconsistent contactwith both parents. Children, for the most part, don’t care where theyspend the night. The parents care…a lot! The kids care about seeingeachparent and interactingwitheachparentona frequentand regularschedule.

Thatsaid,childrenofallageshatemovingbackandforthbetweenhomes.Ihaven’tmetakidyetwhosays,“IlovemovingbackandforthbetweenMom’s house and Dad’s house.” However, most children ofdivorce understand that this is their “newnormal” and accept it. Theydon’t love it,but they tolerate it.Many,manypsychologicalstudiesofchildrenofdivorcehaveclearlydemonstratedthatchildrenareresilient,moreresilientthanwegivethemcreditfor.

Resiliency,however,doesn’tmean thatchildrencanabsorball theconflict of divorcewithout consequences.What does all thismean? Itmeans that children are resilient and can handle a divorce withoutdamagingtheirfuturerelationshipsiftheparentsplanproperly,withthechildren’sbestinterestsinmind—nottheparents’bestinterests,butthechildren’sbestinterests.

Finding theproperparentingplan isdifficult.Wewantchildren tohavefrequentandconsistentcontactwithbothparents,notmovearoundtoooften,andhavearegularschedule.Teenagerswantfewertransitionsand more time (e.g., week on/week off). Toddlers desperately needstructure in both homes (same bedtime, same routines, etc.), butunfortunately, transitionmorebecause they can’t handle asmuch timeawayfromeachparent (i.e.,aparentingplan that isdedicated toMomon Monday and Tuesday, dedicated to Dad on Wednesday andThursday, and alternates weekends— Friday nights throughMondaymornings).

HowtoTelltheKids

Itisimportanttotellyourchildrenaboutyourupcomingdivorceina planned way. Ideally, both parents will be present during theconversation,andtheconversationwillnotoccuruntiltheparentshavedeterminedtheparentingtimedetailsofthedivorce.

Whyisitimportanttoknowtheparentingtimedetailsbeforeyoutellyourchildren?Itisimportanttoyourchildrenbecauseaftertheygetovertheinitialshockoftheinformation,thefirstquestiontheywillaskis,“WherewillIlive?”Theywillnaturallygointo“howdoesthisaffectme”mode, and themore answersyouhave to theirquestions, the lessconflictandturmoiltheywillendure.Tobeclear,theveryfactthatyouare getting a divorce will create conflict and turmoil in their lives.However,themoreyouplan,thelessemotionaldamagewilloccur.

Timingiseverything.Bemindfulthatyourchildrenwillgothroughweeks andmonths of being emotional and “in their heads.” As such,don’t tell your kids in May or June when they are in the throes offinishingprojects at school, nor inDecemberwhenChristmas is ever-presenton theirminds.Don’t take themonvacationandannounce thedivorce.(Yes,I’vehadclientswhothoughtthatwasagoodidea.)Don’ttell them the night before the big game or the overwhelming test. Bemindful of the timing of telling your children. Itwill turn theirworldupsidedownandtheywillneedtimetoadjust.

Myphone ringsoff thehook the firstweekof summer (phew,wemadeitthroughtheschoolyear),thefirstdayofschool(phew,wemadeitthroughsummer),thefirstweekofJanuary(phew,wemadeitthroughChristmas),andthemiddleofApril(thankgoodnessforourtaxrefundsothatwecanpayforthisdivorce).Why?Becauseparentsaremindfulthatproperlytimingthedivorceisimportanttotheemotionalhealthoftheirchildren.

What to say during the announcement is just as important as thetiming. Don’t blame either party. Don’t even hint the divorce isoccurringbecauseoftoomuchfighting.Why?Childrenfightwiththeirsiblings. So, when children hear “toomuch fighting,” they internalizethatinformation,anddays,weeks,orevenmonthslaterthey’llbegintoquestiontheirroleinthefighting,whichleadsthemtoblamethemselvesforthedivorce.Ifyoumustmentionfighting,bemindfulthatyouneedto emphasize the fighting was between the adults and intentionally

mentionthatthefightingbetweentheadultsis100percentunrelatedtothechildren…but,mybestadvicetoyouistonotmentionfighting.I’veseentoomanykidsinternalizeitandbenegativelyimpactedbyit.

Repeatedly inform them that you love them (again and again andagain).

Tellthemthatsometimesitisbestforacoupletodivorcebecauseitallowsthemtobebetterpeople.Thekidswillasklotsofquestionsaboutwhythisishappening.Theywillbecryingoutforanswers.Don’ttakethebait.Why?Tellingthemmoreinformationisashort-termgainandalong-termloss.Itmayhelptheminthemoment(foraboutfiveseconds),but itwill inevitablyeither lead them to try to fix the situation,blamethemselves,orpermanentlydamagetheirrelationshipwithoneparent.

Ifonepartywantsthedivorceandtheotherpartydoesnotwantthedivorce, it’s selfish to tell the kids that fact. If you can’t tell them theinformationsuggestedinthissection,Isuggestatleastbeingneutralorsilentontheissue.Kidsneedtolove,andbeloved,bybothparents.Oneparty’sdeterminationthats/hedoesn’twanttobeinthemarriageisnotalicense to the other party to forever impact their children’s lives bytelling them it isn’t their idea. Why? When one party openly andrepeatedlysays(oractslike)thisdivorceisn’this/heridea,thechildrenbegintoprotecttheperceivedvictimizedparentandthereforeblametheother parent. Whose interest does that serve? It serves one parent. Itdamages the children inways that usually impact their ability to formtrustingandlastingrelationships.Ifyouaretheparentwhodoesn’twantthedivorce, giveyour children thebest gift you cangive themduringthishorrendouslydifficulttimeintheirlives:Givethemthegiftofbeingabletoloveandbelovedbytheotherparent.Ifyoursoon-to-beexisaselfishnarcissistoradeadbeatdrunk,Iassureyouthatyourchildrenwillmakethatdeterminationontheirown,intheirowntime.

Many parents send their children to counseling the day after theannouncement.Istronglydiscourageparentssendingtheirchildrentoacounselorjusttocheckthebox.Why?Childrenthinkthereissomethingwrongwiththemwhentheyaresenttoacounselor.You,oryoursoon-to-beex-spouse,ormostlikelybothofyou,havecausedthebreakdowninyourmarriage.Yourchildrenarenotthecauseofyourdivorce.Thereisnothingwrongwithyourchildren.Theyjustneedtimetoadjust.Thatsaid, there are situations where children should be receiving mentalhealth services. Each child is unique, so address whether or not yourchildneedsmentalhealthservicesbaseduponyourchild’sactionsandwords,andnottocheckthebox.

Finally,bepreparedthatregardlessofhowmuchyouhaveplannedand how mindful you have been with sharing and not sharinginformation, your children could secretly blame themselves for thedivorce. Be aware of questions repeated overmonths and years aboutwhythedivorceishappening.Ifthisisthecase,Isuggestyouthenseekcounselingforyourchild.Atrainedcounselorcanhelpachildseethats/heisnotthereasonforthedivorce.

Ifitseemsconfusingaboutwhetherornotyourchildrenshouldbesent toa counselor, simplyaskyourself ifyourchild is showing signsovertime thats/heblamesher/himself for thedivorce. Ifso,sendyouchildtoaqualifiedcounselor.Ifnot,waitandsee.

ChildrenwithSpecialNeeds

Children with special needs are near and dear to my heart. Inadditiontomediatingdivorcematters,Ialsomediate,facilitate,andtrainparentsanddistrictsinspecialeducationmattersthroughouttheUnitedStates. As such, I know a lot about the unique needs of each specialneedschild.

Childrenwithspecialneedsrequireanunderstandingoftheiruniquesituations.Someneedtosleepintheirownbedeverynightduetotheirneed for routine. Others need to maintain a very rigid parenting timecalendar. Others still require a highly flexible parenting time calendarduetothechild’semotionalstate.

Everyparentof a childwith specialneeds alreadyknows that thisbook cannot address their child’s special needs because, by their verynature,heorsheisuniqueandrequiresuniquesolutions.Everyparentofachildwithspecialneedsalsoknows that thiswillbeoneof themostdifficulttimesinyourlivesbecausethedivorceandtheuniqueneedsofthechildgenerallydonotmixwellwitheachother.

Allthatsaid,itcanhappenanditdoeshappen.Itjustrequiresmoreplanning.

GhostsattheTable

In every divorce, there is the potential of someone new.Whetherthat person is the reason for the divorce or if a newfound love isdiscoveredpost-divorce,thatpersonisaghostatthetable.

Aghostatthetableisaparent’snewlovewhoimpactsthechildren.The new girlfriend/fiancée/wife who is the one picking up the kids,dropping off the kids, or putting the kids’ pictures on Facebook. Thenewboyfriend/fiancé/husbandwhoiscoachingthekids’baseball team,wrestlingwith the kids, or taking the kids camping. These are peoplewhoimpactyourchildren’slivesbuthavenopersonalconnectiontoyouandmayharborillwilltowardyou.Thesearetheghostsatthetable.

What do you do about your ex-spouse’s new paramour? Youbefriend them. You tell them about your kids’ hopes and fears. Youdon’ttalkaboutyourex-spouse.Youenlistthemtohelpyouparentyourkidswhenyouarenotthere.Behonestandaskyourselfwhatisbestforyourchildren.Yourchildrenareinthebestsituationiftheyhavemoreadultswholovethem,notfewer.Yourchildrenareinthebestsituationif theysee theirparentsproperlycommunicatewitheachotherandtheghostatthetable.Thismaybethehardestthingtodo,butsuckitupandbeniceforyourkids.

If you can’t make friends, then live by The Godfather’s motto,“Keepyourfriendscloseandyourenemiescloser.”

AskingtheKidsQuestionsAboutYourEx-Spouse

Duringandafter thedivorce,youmayaskyourchildrenquestionsaboutyourex-spouse.Thesequestionsmaybeinnocent,ortheymaybecalculated.Eitherway,however,yourchildrenwillviewthesequestionsatbestwithskepticism,andatworstwithirritation.

Some parentswrongly try to prove to their children that they cantalkabouttheotherparenttothechildrenwithoutanydrama.Thisgoalisrarelyachievablebecausetheparentforgetsthatthechildisapartytothe dialogue and has his/her own assumptions and beliefs about thequestions.

Don’t ask if your ex-spouse is happy, has a new job, or even theinnocuous,“How’syourmother/fatherdoing?”

Rather,listentoyourchildrenandaskyourchildrenquestionsabouttheirlives.Childrenofdivorce,evenhappydivorces(yes,theydoexist),compartmentalize each parent’s life. They may talk about the otherparent,butthesecondtheyareaskedaquestionabouttheirotherparent,alarmbellsgooffintheirheads.

Solisten,butdon’task.

TheGiftofOneYear

Thefirstyearofyourdivorcewillfeel…different.Somepartieswillwant to date. Some parties will feel pressured from their friends andfamily to date. If you have children, you need to put your children’sneedsfirst.Anddon’ttellyourselftheurbanmyththataslongasyouarehappy, they are happy. Wrong. Children are selfish by nature. Theydon’tcareifyouareromanticallyhappy.

Do notmake themistake of introducing new romantic partners toyourchildrenduringthefirstyearofthedivorce.Youryearoffreedomisyourchildren’syearofchaos.So,ifyouknowthatyourchildrenareexperiencing a year of chaos, why would you knowingly introduce anewdynamicintotheirlives?

And let’s dispel the myth that the kids don’t know you areromantically involvedwith an adult known to them. I hear this all thetime, “Janice/Richard has always been in their lives. We are reallycareful. The kids don’t know.” The kids know that a parent has beenremovedandnowJanice/RichardispayingmoreattentiontoMom/Dad.They know that this person is now taking on amore parent-like role,makingeyecontactwithMom/Dad, thatMom/DadseemstorelyuponJanice/Richardforemotionalsupport,andthatJanice/Richardis“aroundalotmore.”RegardlessofhowcarefulyouarewithJanice/Richard,thekidsalmostalwaysknoworsuspectyourrelationship.

IwillneverforgetwhenIhadtheopportunitytointerviewachildofdivorceninemonthsafterhisparents’divorce,adivorceImediated.Hewasfortunatetohavetwolovingandintelligentparents.Hetoldme,“ItislikeIaminaplanethatiscrashing,buttheplanehasn’tyetcrashed.”ThatisthebestexplanationIhaveeverheardofachild’sexperienceofthefirstyearofadivorce.

Iamnotsayingdonotdate.HavesexlikebunniesforallIcare,butdo not bring your children into themix. If you have found “the one,”then“theone”willwaituntilyourchildrenhavehad time toadjust. Ifs/he can’t wait, s/he isn’t “the one!” Please do not sacrifice yourchildren’sfragilepsychologicalstate,apsychologicalstate thatyou(atleastpartially)created,foryourromanticlife.Theirlittlebrainsandtheirbeautifulheartsneedtimetoheal.Givethemthegiftofoneyear.

Freebie

Forafree“ParentingTimeScheduleComparisonChart,”emailmeatinfo@MediationNorthwest.comandIwillemailittoyou.

5.

HOWTODIVIDEITUP

CommonLawvs.CommunityProperty

Oregon is a common law property state, which means you areentitledtopropertywithyournameonit.WashingtonandCaliforniaarecommunity property states, which means that the property you createduringamarriageisequallybothspouses’property.

AlthoughOregonisacommonlawpropertystate,Oregonpretendsto be a community property state for the limited purpose of divorce.Whatdoesthatmean?Itmeansthatduringadivorce,thecourthastherighttoawardanypropertycreatedduringamarriage,regardlessoftitle,toeitherspouseandwilldistributethepropertyinanequitablemanner.

Assets

You know (or think you know) the assets of yourmarriage. Thissectioncontainsabriefdescriptionofstandardassetsofamarriageandcommonwaystohandlethedistribution.Thislistdoesnotcontaineverypossibleasset,butrather,providesahighlightofcommonlyheldassets.

This sectioncontains a lot of important information, and it canbedifficult to digest. I fully support eating an entire cupcake or drinkinghalf a glass of wine/beer when reading this section. Eat or drink

slowly…thisisalongsection,anditisthemostimportantsectionintheentirebook.Somehoweatingcupcakesmakes iteasier formybrain todigestdifficultinformation.

Pre-MaritalandMaritalAssets

In mediation, we need to know every single asset in your name.However,everyassetmaynotqualifyasamaritalasset.Let’sdigabitdeeper.

Anassetacquiredpriortothemarriageiscalledapre-maritalasset.Althoughapre-maritalasset ispresumednot tobeamaritalasset, thecourthastherighttodeclareitaspartofthemaritalpot.Thisishighlyunlikely,but it ispossible.For simplificationpurposes, Iwillpresumethatpre-maritalassetsarenotapartofthemaritalpot.

Ifanassetisbothpre-maritalandmarital, thenthemaritalvalueisdeterminedasfollows:currentvalue–pre-maritalvalue=maritalvalue.Forexample,ifyouandyourspouselivedinahomethatyoupurchasedprior to themarriageandyoueachhavecontributedto thehome,mostcouples agree that home has a marital value. So, if your home iscurrentlyworth$150,000anditwasworth$50,000beforethemarriage,thenthecurrentvalueofthehouseisreducedbypre-maritalvalueandthemaritalvalue is$100,000.The formula looks like this:$150,000–$50,000=$100,000.

There is a hot debate as to whether pre-marital passive growthincomeismaritalornotmarital.Whatdoesthatmean?Let’stakeabiteofthatcupcakeandthenbreathe.We’vegotthis.

We already know that “pre-marital”means it happened before themarriage. “Passive growth” means the asset grew in value by marketforces and not by your hand (i.e., interest on a savings account).“Income”meanstheamounttheassetgrew.So,it’sthevalueofthepre-marital asset that occurredduring themarriage, not by anyone’s hand.Yes,it’scomplicated.Let’slookatareal-lifeexample.

If(1)Ross’sretirementaccountwasvaluedat$50,000prior tohismarriage, (2) Ross added another $50,000 to his retirement accountduring themarriage, and (3) the account earned $25,000 in gains andinterest during themarriage, then Ross’s account balance is $125,000($50,000 + $50,000 + $25,000 = $125,000). It is normal for Ross toassign theoriginal$50,000aspre-maritaland thereforenotpartof themaritalestate. It isdebatablewhetherornotRosscanalsodeclare thatthepassivegrowthpre-maritalinterestearnedontheoriginal$50,000isnon-marital.Howisthepassivegrowthinterestdeterminedononlythepre-marital portion? When this issue arises in my office, we hire afinancialprofessional.

RealEstate

Ifyouownahouse,condo,apartment,duplex,commercialproperty,or bare land, you own real estate. Even if your real estate has amortgage,youstillownrealestate.

Thereareseveralwaystodeterminethevalueoftheproperty.Theplatinum standard is to order an appraisal, which is prepared by acertified or licensed appraiser. Generally, an appraisal costs between$450 and $800. The gold standard is to order a comparative marketanalysis,commonlyreferred toasa“CMA,”which isavalueestimatepreparedbyarealestateagent.Generally, this isafreeservice. I fullysupport my clients using a comparative market analysis. It’s the bestvalue when looking at quality of information vs. price. The silverstandard is when parties mutually agree upon the value, either bylookingat recentsellingpricesofareahomesorusing internetvaluingservices such as Zillow. Zillow is either dead-on accurate or wildlyspeculative,sometimesinthesameneighborhood.Istronglyencourageyou not to use the tax-assessed value of your property. Tax-assessedvalues are rarely accurate because the value is determined using analgorithmandnotmarketforces.

Parties can avoid valuing the property if they agree to sell thepropertyandequallysplitthenetproceedsfromtheproperty.

Thevalueof thehome is the realmarketvalue less themortgagesandloansattachedtotheproperty.

Ifonepartywillbeawardedthepropertyandthemortgageisinbothparties’names, then it is standard to requireoneparty to refinance the

loanintothatparty’ssolename.Somepartieswilldiscountthevalueofthehomebythecosttorefinancetheloan.

Rental properties and commercial properties contain additionalhurdles.First, if you sell a rentalor commercial property, then (1) thegain (i.e., the profit) will be taxed as a capital gain, and (2) if thispropertywasdepreciatedonyourtaxes,thenyouwilllikelyneedtore-coup depreciation, too. What does all this mean? It means yourrental/commercialproperty’svalueissignificantlyreducedduetotaxes.So, if you are taking a rental/commercial property and your spouse istakingtheprimaryresidence,thenyouneedtorequestadiscounttotherental/commercial property’s value for capital gains and potentialrecoupmentofdepreciation.

Ifawardingthepropertytooneparty,inmediationweneedtoknowthe real property’s legal description, the mortgage lender’s name, theaccount number of themortgage lender, the balance of themortgage,andthevalueoftheproperty.

AutomobilesandBigBoy/GirlToys

Cars, trucks, snowmobiles, jet skis, quads, boats, etc. — thesevehicles and toys need to be awarded to a party, and they need to bevalued.

Inmediation,weneedtoknowthefullnameofthevehicle/toy(e.g.,2014FordMustang),theVINnumber(ifavailable),thevalue,andany

loan attached to the vehicle/toy (including the loan’s name, accountnumber,andloanvalue).

Businesses

Many couples own a small business— the auto repair shop, thecornerfranchise,etc.Smallbusinesseshavevalue.Valuingthebusiness,however,isdifficultandrequiresaprofessional.Abusinessvaluationisnot cheap ($4,000–$10,000), but it is worth its weight in gold!Why?Becausethevalueofmostsmallbusinessesexceedsbyfar(generallybytens of thousands of dollars) the cost of the valuation.At its simplestform, thevalueof thebusiness includes the assetsof thebusiness, theliabilitiesofthebusiness,thegoodwill(i.e.,reputation)ofthebusiness,andfuturestreamofincomeofthebusiness.

Iroutinelyseeclientsfailtorecognizethevalueofabusiness.Thebusiness-owner spouse talks the non-business-owner spouse intobelievingthatthebusinessdoesnothaveavalue.Somebusinessestrulydonothavevalue,suchasahairdresser,amoderaterealestateagent,asolomechanic, etc. So, how do you know?You hire professionals toadviseyou.

In mediation, we need to know the name of the business, thebusiness’s legal entity structure (e.g., corporation, sole proprietorship),theownersofthebusiness,thevalueofthebusiness,andtheliabilitiesofthebusiness.

RetirementAccounts

The entire retirement subsection is one of the most importantsections in the “Assets” section. Read it in one sitting when you areawake and can process information. I suggest you get a cupcake…ortwo.Ittookme15yearstotrulyunderstandthisinformation.Isuggestreadingittwice.

Retirementaccountscome inmanyshapesandsizes.Donot listentoyourco-workerexplainhowtodividea retirementaccount,becausethetypeofaccountdetermineshowitisvaluedandhowitissplitup(ifatall).

In theworld of divorce, the twomost common types of plans aredefinedbenefitplansanddefinedcontributionplans.

DefinedBenefitPlans

Adefinedbenefitplanisaplanthatmostoftenpaystheparticipantevery month from the date of retirement until (generally) the date ofdeath.A common name for this type of plan is a pension, but not allpensionsaredefinedbenefitplans.Yes,itisconfusing.

Oregon’sPERSTierOne,TierTwo,andOPSRPoperatesimilartoadefinedbenefit plans. The federal government’s military, FERS andCSRSplansalsooperatesimilar toadefinedbenefit plan.Manyunionplans are also defined benefit plans. The military and the post officeofferdefinedbenefitplans,too.

Thevalueofadefinedbenefitplanisnotreadilyavailablewithouthiringanactuary.Anactuarialvaluationgenerallycostsbetween$450and $800, depending upon the plan,whether or not amarital share isbeing determined, and whether or not passive growth is included orexcluded. (Please review the “Pre-Marital andMarital Assets” sectionabove).Ifitsoundscomplicated,thatisbecauseitiscomplicated!

Definedbenefitplansalsohavethepossibilityofsurvivorbenefits.Manyattorneysandpartiesforgettonegotiatesurvivorbenefits.Unlessa survivor benefit is elected almost all of these plans will cut off theformerspouse’s retirementawardupon thedeathof theretiredspouse.Can you imagine?Youwere divorced twenty years ago, you are nowretiredwithacompletelydifferentlife,yourformerspousediesandyourretirement benefits are gone because someone failed to properlynegotiatethisarea!Thisisanareathatneedstobemindfullynegotiated—anotherreasontohireanattorney-mediatorwhoknowsthisstuff.

DefinedContributionPlans

Adefinedcontributionplanisaplanthatcontainsacertainsumofmoney.Onceyouhavepulledoutthatsum,thereisnomoreretirementaccount.Forsimplicity’ssake, Ihave includedalldefined contributionplans into this section. A 401(k), Profit Sharing, 401(a), 403(b), 457,IRA,ROTHIRA,Simple IRA, IAP,andTSParedefined contributionplans.

For defined contribution plans, the value is the balance of theaccount. Easy-peasy lemon squeezy! Finally, something easy aboutretirementaccounts.

CombinationDefinedBenefitandDefinedContributionPlans

Some companies offer a combination of retirement benefits thatincludebothadefinedbenefitplanandadefinedcontributionplan.ThestateofOregonprovides(mostof)itsemployeesbothadefinedbenefitplan (PERSTierOne/TwoorOPSRP)andadefined contribution plan(IAP).Most federal agenciesalsooffer their employeesbothadefinedbenefit plan (FERS or CSRS) and a defined contribution plan (TSP).Someunionsalsooffertheirmembersacombinationofadefinedbenefitplan(pension)anddefinedcontributionplan(401(k)).

Retirement:HowtheFundsGetfromOneAccounttoAnother

For both a definedbenefit plan and a defined contribution plan,generally a supplemental judgement is required to award retirementaccounts (of course, exceptions exist — see the discussion of IRAsbelow).Thethreemostpopulartypesofsupplementaljudgmentsusedtodivideretirementaccountsarecalled:(1)QualifiedDomesticRelationsOrder(QDRO—pronounced“quadro”),(2)DomesticRelationsOrder(DRO — pronounced “d-r-o”), or (3) Court Order Acceptable forProcessing(COAP—pronounced“coapp”).AQDRO/DRO/COAPis

drafted by a professional who specializes in drafting these types ofsupplemental judgments and generally costs between $750 and $1,200each.

MostIRAsdonotrequireasupplementaljudgmentsolongasthegeneraljudgmentofdissolutionincludescarefullycraftedlanguage.Ifatallpossible,ItrytoequalizetheretirementaccountsthroughanIRA.Ifit isnotpossible toequalize throughan IRA, I try tomove retirementfundsfromonepartytoanotherwithonetransactionsothatmypartiesonlypayoneQDRO/DRO/COAPfee.

Retirement:HowMuchtoDivide

Therearedifferentwaystodeterminehowmuchretirementshouldbedivided.Donotbelievetheurbanmyththatyouareeitherentitledtohalfofyour spouse’s retirement accountor that youmustgivehalfofyour retirement account to your spouse. There is no law that requiressuch a division. Howmuch gets divided, however, depends upon theoverallassetsandliabilitiesofthemarriage.

For both defined benefit plans and defined contribution accounts,parties should consider themarital value of each plan. (Please see the“Pre-Marital and Marital Assets” section above.) For instance, IfRachel’sdefinedcontributionplan isworth$150,000 today,but itwasworth$50,000whenshemarriedRoss, thenRachelwillwant tobegindiscussing the account’s value at $100,000. (The formula is: current

value – pre-marital value = marital value or $150,000 – $50,000 =$100,000.)Additionally,thepartieswillwanttodiscusswhetherornottheaccount’spassivegrowthincome(i.e.,theinterestearnedonthepre-maritalportionduringthemarriage)ismaritalorpre-marital.(Pleaseseethe“Pre-MaritalandMaritalAssets”sectionabove.)Ifthepartieselectto include passive growth income, then an expert must be hired todeterminepassivegrowth.

For defined benefit plan benefits, some parties chose to split themarital share of each defined benefit plan 50/50. This 50/50 splitprovidestwoadvantages.First,iteliminatestheneedtohavetheaccountvalued,whichsavesmoney.Second,bothpartiesgethalfofthemaritalaccount’s actual value, not an expert’s opinion of the value, which isspeculativeatbest.Ifullysupportthisoptiontomyclients.Ifmorethanone defined benefit plan exists, it gets complicated. Someparties spliteachdefinedbenefitplan’smaritalshare50/50toensuretheequalityofthedistribution.Otherpartieshireavaluationexperttovaluethemaritalshare of all of thedefinedbenefits planbenefits and then equalize themaritalshareinonestep(ifpossible).Iknow,myeyesareglazingover,too.Youarenormal.Reasonnumber204whyyouhireprofessionals!

Fordefined contribution accounts, most parties equally divide themaritalshareofthetotalbalanceoftheparties’definedcontributionaccounts.Forinstance,ifRachelhasthreedefinedcontributionaccountswith a total marital value of $200,000 and Ross has two retirementaccounts with a total marital value of $150,000, it is best to move

$25,000fromoneofRachel’saccountstooneofRoss’saccounts.Afterthis transaction, Rachel will have $175,000 and Ross will have$175,000. Making a single transaction from one account makes lesswork, is mathematically sound, and can cost less if a supplementaljudgment(akaQDRO/DRO/COAP)isnecessarytodividetheaccounts.

Some parties use a retirement plan’s value to offset other maritalassets’ values. For instance, if the total marital value of Rachel’sretirementis$200,000andthetotalmaritalvalueofRoss’sretirementis$150,000,thentheymaywanttomove$25,000fromRacheltoRosstoequalizethedistribution,leavingeachpartywith$175,000.However,ifthe equity in the home is worth $25,000 and the home is awarded toRoss,thenmanypartiesconsiderthedivisiontobeequal.But…

Usingaretirementaccounttooffsettheequityinthehome,dollar-for-dollar, is notmathematically sound. To explain, taxable retirementaccounts are taxed uponwithdrawal (i.e., if you take $250,000 out ofyour retirement account, you are taxed on that money). On the otherhand,whenapersonsellsaprimaryresidentialhome,asinglepartycanreceiveupto$250,000TAX-FREE!Inotherwords,ifthereis$250,000intaxableretirementand$250,000inequityinahome,thenthepersonwith theequity in thehomewill realize$250,000,but thepersonwiththetaxableretirementaccountwillneverrealize$250,000duetofederalandstatetaxes.

Usually, thebestway tohandle retirement is to: (1)determine themaritalshareofeachparty’sretirement,(2)equalizethemaritalshareof

thenon-taxableretirementaccounts(i.e.,ROTHIRA)inonetransaction,(3) equalize the marital share of each defined benefit plan, and (4)equalize themarital share of the defined contribution accounts in onetransaction.

Ifthisisnotpossible,thenpartiesmaywanttodiscountthemaritalportion of the taxable retirement plan for potential future taxes. Theformulalookslikethis:currentvalueof themaritalshareofretirementlesspotentialfuturestateandfederaltaxes=valueusedindivorce.(i.e.,$250,000–38%=$155,000).This option is speculative at best.Mostpartieshireanaccountanttosuggestthetaxreductionpercentage.Thisisalastresortoption.

Retirement:WhentoDivide

AlthoughtheQDRO/DRO/COAPshouldbedraftedandenteredbythecourtassoonafterthedivorceaspossible,whenthedefinedbenefitplan is actually divided is negotiable andmay significantly impact theparties.

Inthisscenario,RosshasalargedefinedbenefitplanandRachelisbeingawardedaportionofRoss’sretirement.IftheQDRO/DRO/COAPorders theplan to immediatelydivide thebenefit (this is called anup-front-division), it generally (not always) favors the individual who isenrolled in the retirement plan (i.e., Ross). If the QDRO/DRO/COAPorders the plan to divide the benefit at retirement (this is called adeferred-division),thedivisiongenerally(notalways)ismoreneutraltoboth parties. However, the deferred division has some risk to theindividual not enrolled in the retirement plan, too. Yes, this is

complicated,which iswhyyouwant tohire an attorney-mediatorwhocanexplainyouroptionstoyou.

MilitaryRetirement

Military retirement is complicated.Many rules apply,but this ruletends to separate themilk from the curd: If your spouse qualifies forretirement from themilitary, youweremarried for ten years ormore,andyourspousewasinthemilitaryfortenofyourmarriedyears,thenyou (the non-military spouse) may qualify to receive a share of themilitarypension.Ialwayshireamilitaryretirementspecialistwhenthisissuearisesinmyoffice.

PERSHelpfulHint

AquicknoteaboutPERS:DonotbefooledbythePERSmemberaccountbalanceshownontheAnnualMemberAccountStatement.Thisvaluedoesnotindicatethataccount’sactualvalue.Someofthefactorsthatdeterminethevalueofthebenefitincludewhenthememberretires,howmanyyearsthememberworkedinthePERSsystem,themember’shighestcompensationduring thePERSemployment,andhowlong thememberlives.Indeed,it’sfairtosaythatmanyPERSTierOneandTierTwoaccountshave“missing”moneythatisnotreflectedbytheAnnualMemberAccountStatement.Oneclient’sTierTwostatementindicated

heraccountbalancewasonly$11,000.ShehadworkedwithinthePERSsystem for 22 years, so I suspected somethingwas wrong. I hired anactuarytovaluetheaccountandhevaluedtheaccountatover$200,000!

Retirement:ImportantPartingThoughts

Althoughmost retirement plan participants cannot withdraw fromretirement without taxes and penalties, a trick exists for definedcontribution plans.AQDRO (not aDROor aCOAP) can be used towithdrawmoneyfromadefinedcontributionplanbeforeage59½solong as it is paid directly to the spouse who is not enrolled in theretirement plan (i.e.,Ross’s plan, but awarded toRachel). Themoneywillstillbetaxedasincome,toRachelbuttheQDROwillavoidthe10percent penalty. Some parties use this option to pay off jointly heldliabilitiesortoobtainfundstopurchaseanewhome.

Tobeclear,choosingthisoptionisfinancialsuicidebecauseofthetax,butitisanoptionthatmaybenecessarytopayoffjointliabilities.Losing24–38%ofyourretirementaccountisalwaysalastresortoption.

Hereisyourfinaltake-away:Beforeyouthrowyourheadontothetable in exasperation, remember, this iswhyprofessionals are hired tohandlethisstuff.

LifeInsurancePlans

Life insurancecanbeanassetof themarriage,butonly if ithasavaluewithout requiring the death of the party. To explain, whole lifepolicies,annuitypolicies,anduniversallifepolicieshaveavaluethatapartycanwithdrawpriortodeathandthusareanassetofthemarriage.Termlifeinsuranceplansdonothaveavalueforthemarriageandonlyhaveavalueuponthedeathofthepolicyholder.

If a party owns a whole life, annuity, or universal life insurancepolicy,inmediationweneedtoknowthenameofthepolicy,theholderofthepolicy,theaccountnumberofthepolicy,andthevaluethatcanbewithdrawnfromthepolicy.

Life insurance isalsoaddressed in the“HowtoPayforYourLifeAftertheDivorce”sectionofthisbook.

GiftsandInheritance

Gifts (including inheritance) received during the marriage butseparatelyheldbythereceivingpartyinthereceivingparty’snamearepresumed to be the property of the receiver and not subject tomaritaldivision.This presumption, however, can be rebutted, and a court cantakeitintoaccountifthecourtsodesires.

Debts(akaLiabilities)

It is rare inAmerican culture for a person not to have a liability.Liabilities,however,comeinmanydifferentforms.Don’tworry,thisisany easy discussion. You won’t even need an alcoholic beverage tounderstandit.Ithinkanothercupcakeisadandyidea,though.

UnsecuredLoans(akaCreditCards)

Most parties have credit cards and other “unsecured” loans. Anunsecuredloanisaloanthatisn’tattachedtoanasset.(Staywithme;itreallyisn’tdifficulttounderstand.)Inotherwords,anunsecuredloanisanyloanthat,ifnotrepaid,willnotimpactanasset.Ifyoudon’tpayforyourcarloan,yourcarisrepossessed.Ifyoudon’tpayyourmortgage,your home is foreclosed. All of these loans are secured by an asset.Therefore,anunsecuredloanisanycreditcardandanyotherloanthatdoesnotattachtoanasset.

Here is the most important part to understand when it comes tounsecureddebtinadivorce.Unsecureddebtcanbeheldjointly(i.e.,inboth husband and wife’s name) or individually (i.e., in wife’s nameonly).Inadivorce,itisalwaysbesttoawardtheindividuallyheldloantotheloanholder(e.g.,Rachel’sCapitalOnecardshouldbeawardedtoRachel). Why? Because if we assigned Rachel’s Capital One card toRoss andRoss fails to pay it, guesswhoCapitalOne is coming afterwithacourtordertogarnishRachel’scheckingaccount?Rachel!

Why? The court cannot legally change the original contractualobligationbetweenapersonandthecreditcardcompany.Thecourtcanimpact Ross and Rachel, but not third parties, such as Capital One.Technically, there is fancy legal language called “Indemnification andHoldHarmless”that,intheory,requiresRosstohireattorneystoprotectRachelfromCapitalOneifhedoesn’tpaythebill.Practically,however,if Ross can’t afford to pay Capital One, he can’t afford to pay forattorneystoprotectRachelfromCapitalOne.

What should parties do with those pesky jointly held unsecuredloans?Istronglyadviseclientstohandlejointlyheldunsecuredloansbyeither(1)assigningfiftypercentoftheaccounttoeachpartyandpayingoffeachparty’sassignedamountwithanothercreditcard(i.e.,abalancetransfer), or (2) assigning the account to one party and requiring thatpartytorefinancetheaccountintohis/hersolename.Inotherwords,ifthe jointly held Capital One card is assigned to Rachel, then Rachelneedstoberequiredtorefinancetheloanintohersolename;or, if thejointlyheldCapitalOneaccountisassignedfiftypercenttoeachparty,then each party pays off the assigned fifty percent through a balancetransferfromanothercreditcard.

For divorce purposes, the value of a liability is today’s pay-offamountunlessthepartiesagreetoaddthefutureinteresttotheliability,whichisrare.

LiabilitiesAttachedtoAssets

Many assets have a liability attached to them. For example, a carwith a car loan is an asset with an attached liability. Same for mostfamily homes. It is important to address the loan attached to the assetwithin the asset’s value. For instance, if the sale price of the familyhomeisreducedbytheamountofthemortgage,themortgage(i.e.,theliability)isproperlyreducingthevalueofthehome(i.e.,theasset).

So,ifwehaveacolumnofassets’values(likethe$150,000intheexampleabove)andwehaveacolumnofliabilities’values(suchastheCapitalOnecreditcard),wecan’tplace themortgageinboth theassetand the liabilitycolumnsbecause that isapplyingone loan twice.Thisinappropriatepracticeiscommonlycalleddoubledipping.

RefinanceCosts

For either unsecured liabilities (i.e., credit cards) or liabilitiesattachedtoassets(i.e.,thehouseorthecar),thecostofrefinancingtheseliabilities into one party’s sole name can be negotiated in mediation.Assuming a refinancehappens, theparties shoulddecide if the cost torefinance should be included in the cost of the divorce. For example,when a party refinances the family home, it generally costs between$4,000 and $7,000. If Ross refinanced the family home and incurred$5,000ofrefinancecosts,hemayaskthatthe$5,000reducethevalueofthefamilyhome.Thesameistrue,buttoalesserextent,forrefinancingotherliabilities.

EducationalLoans

Educational loans are a mixed bag. If the educational loan wasobtainedpre-marriage,itispre-maritaland(1)shouldbeassignedtothe

partywhooriginallytookouttheloan,and(2)shouldnotbetakenintoaccountinthemaritaldistribution.

Educational loans that were taken out during the marriage aremessy.Thisisanunsettledareaofthelaw.Ifapartyisreceivingspousalsupport based upon the additional education the loans provided (e.g.,Ross makes more money because he took out loans to obtain hisdoctorate inpaleontology), thensomecourts include,andsomepartiesnegotiate for, the loans to be included asmarital loans (although stillassignedtotheoriginatingparty).Somecourtsandsomepartiesdonotincludetheseloansasmarital.

The messiest moment is when parties have refinanced theireducationalloansintooneloan(i.e.,Rachel’sloansandRoss’sloansarenowoneloan).Whenthishappens,bothpartiesneedtodecideif(1)theloansaremarital,and(2)who isassigned the loan.Usually,when thissituationarises,Isuggesteachpartyrefinancehis/hershareof theloanintohis/hersolename.

FamilyLoans

Familyloansareamixedbag,too.WhenIspeakoffamilyloans,Imeanunsecuredfamilyloans(thatis,MomandDadloanedyoumoneybut didn’t take a lien out on your property). Some families absolutelyexpect to be paid back their loan. Other families have an unspokenagreementthat theloanwon’tbepaidback—hencetheproblem.The

spouse who was loaned the money inevitably insists that the loan becounted because it will be paid back, while the other spouse fumesbecauses/heknowsperfectlywellthattheloanisnevergoingtobepaidback.At this point, it is a determination of the finder of fact (i.e., thecourtorbyagreementoftheparties).

BankruptcyandJudgments

Ajudgmentforthepaymentofmoneyisanimportantlegaltooltorequire Party A to pay Party B a certain amount of money into thefuture.Spousalsupport,childsupport,andpaymentsofmoneyintothefuturearegenerallycalledmoneyjudgmentawards.

Alienisalegaltoolthatallowsforasumofmoneytobesecuredbyproperty. For example, Rachel owes Ross $50,000, to be paid in twoyears.RossplacesalienonRachel’shomesothatifRachelfailstopaythe$50,000,RosscanforecloseRachel’shomeandgetpaid.

Abankruptcyproceedingcanpreventadivorcefromoccurringuntilafterthebankruptcyhascompleted.

Bankruptcy after a divorce is a potential nightmare for the non-bankrupt party. Except for spousal support and child support, otherliabilities (judgments, liens, and/or obligations) can be discharged in abankruptcy.

Whatdoes thatmean?Well, for example, ifRachel isordered topayforthatjointlyheldCapitalOnecardandRachelclaimsbankruptcy,

thebankruptcycourtcoulddischargeRachel’sobligationtopayfortheliability,whichmeansthatCapitalOneisgoingtoknockonRoss’sdooranddemandpayment.ItisforthisreasonthatIstronglyadviseclientstorefinancealljointliabilitiesintotheirsolenames.

Let’s look at a more complicated scenario. Ross amassed theparties’retirementduringthemarriagebutthrewafitduringthedivorceprocess that the retirement should not be split. Rachel agreed to beawarded$100,000tobepaidwithinfouryearsofthedissolutioninlieuoftheretirement.Rachelwassmartandhada$100,000lienplacedonthefamilyhomeuntilthe$100,000waspaid.Rossdeclaresbankruptcy.Additionally, Ross lets the family home go into foreclosure. Thebankruptcycourtcan,andmostlikelywill,dischargeRoss’sobligationtopaythe$100,000,andsincethehouseisinforeclosure,Rachelwillbeluckyifsheseesafewthousanddollarsofher$100,000.

Here’sthetake-away:Ajudgmentoralienwillprotectyouuntilabankruptcycourtsaysotherwise.Besmartaboutyournegotiationsandgeteverythingyouareowedassoonaspossible.

TheMath

Themathofadivorceisnotcomplicated.Ihaveadoctorate,butIhaven’t taken math since my sophomore year in high school. Whenpeopletalkmath,allIhearis,“blah,blah,blah,blah.”Myeyesrollintomyheadandmybraingoescompletelyblank. Iknowtheyare talking

andusingwords,butIhavenoideawhattheyaretalkingabout.So,ifIcandoit,youcandoit.

Theonlymathskillsyouneedarebasicaddition,basicsubtraction,andbasicdivision…andacupcake.Therearefivebasicstepstodivorcemath:

StepOne.Createacolumnforeachparty.

Step Two. Assign each asset of the marriage to eitherpartyandincludeeachasset’svalue.Adduptheitemizedassets’valuesforeachcolumn.

StepThree.Assigneachliabilityofthemarriagetoeitherparty and include each liability’s value. Add up theitemizedliabilitiesforeachcolumn.

StepFour. Subtract each column’s liabilities from eachcolumn’sassets.Thisresultsinatotalforeachparty.

Step Five. Subtract the higher award from the loweraward. Divide the result by two. If the parties want toequalize thedivisionofassetsand liabilities (i.e.,50/50),this is theamount thatneeds tobemovedfromthepartywith more overall value to the party with less overallvalue.

Rachel Ross TheMath

TotalAssets $300,000 $240,000

TotalLiabilities $10,000 $20,000

EquityTotal $290,000 $220,000

Rachel:$300,000–$10,000=$290,000Ross:$240,000–$20,000=$220,000

DifferenceofEquityTotals $70,000 $290,000–$220,000=$70,000

HalftheDifferenceofEquityTotals

$35,000 $35,000 $70,000/2=$35,000

TOTAL $255,000 $255,000

Rachel:$290,000–$35,000=$255,000Ross:$220,000+$35,000=$255,000

Freebie

For a free “DivorceMediationDocumentChecklist,” emailme atinfo@MediationNorthwest.comandIwillemailittoyou.

6.

HOWTOPAYFORYOURLIFEAFTERTHEDIVORCE

ChildSupport

TheOregonChildSupportDivisionoffersacalculatortodeterminechildsupport.Somepartiesfind thiscalculatoreasy touse;othersfindthe multitude of options difficult. Oregon law requires all divorcingpartieswithchildren20yearsandyoungertocalculatechildsupportandadvise the court of the calculated amount of child support, which iscalledthepresumedamountofchildsupport.

Isuggesttakingoneortwobitesofyourcupcakeorasiportwoofyourbeverage.Thisiswhatyouneedtoknow.

Income

Eachparty’sgrossincome,notnetincome,needstobeused.Grossincomeistheamountofyourpaycheckbeforeanydeductionsfortaxes,healthinsurance,and/orretirement.Ifapartyreceivesbenefitsfromanemployerthatcrossoverintothatparty’spersonallife,thecostofthosebenefits is added to the party’s gross income.The typical benefits arecellphone,carallowance,andhousingallowance.

Ifapartyisself-employed,thentheparty’sgrossincomeisreducedby the ordinary and necessary business expenses. However, the self-employed party is only allowed to deduct one half of the self-employmenttax,andiftheself-employedpartyisreceivingbenefitsthatcross over into that party’s personal life (as indicated in the aboveparagraph),thosebenefitsarethenaddedintothatparty’sgrossincome.For individuals who are receiving disability benefits, Social Securitybenefits,orunemploymentbenefits,theactualamountofthosebenefitsisconsideredgrossincome.

Additionally, full-time minimum wage is presumed for a party’sgross income unless that party works in a profession that historicallydoesnotoffer40hoursperweek to the individualorwhoseemployerdoesnotoffer40hoursofworkperweek.Finally,ifapartyisreceivingTemporaryAssistanceforNeedyFamilies(TANF)orWomen,ChildrenandFamilies(WIC)(i.e.,foodstamps),thatparty’sincomeispresumedtobeminimumwage.

AdditionalInformationRequiredfortheCalculation

Thecalculatorrequiresthatyouinsertthefollowinginformation:(1)spousal support paid, (2) spousal support received, (3) work-relatedchild care expenses, (4) union dues, (5) disability, veteran’s, or SocialSecurity benefits received by the child, (6) the number of the parties’

minorchildren,(7)thenumberoftheparties’childrenattendingschool(seebelowforadditionalinformationaboutachildattendingschool),(8)theparentingtimeovernightsforthechildren,(9)anychildrenofeitherparent not belonging to the other parent, (10) the health insurancepremiumforeachparent,and(11)thehealthinsurancepremiumforthechildren. Each area to input is relatively simple…until it is not. TheChildSupportDivisionhasaddedhyperlinksandpop-upstoeachareatobestdescribetheinformationtheyareseeking.

Deviations(i.e.,Agreed-UponChildSupport)

Oncethepresumedamountofchildsupportiscalculated,partiescanthen deviate from the presumed amount to their agreed-upon childsupportamount.Howdoesonedothis?

The Oregon Administrative Rules allow for deviations for manydifferent reasons, including,butnot limited to the financialobligationsof theparties,evidenceofother financial resources,desirabilityofonepartytoremaininthefamilyhome,specialneedschild,hardshipofoneparent,andagreement.Toapply thedeviation, select the rebuttal type,applyittotheappropriateparty,applytherebuttalfactor,and—poof!—theagreed-uponamountisnowyourchildsupportamount!

HealthInsurance

Solongasonepartyhashealthinsuranceavailableforthechildren,that information should have been entered into the initial calculation.However, if neither party has health insurance, then an award of cashmedical support is necessary. What is cash medical support? Cashmedicalsupport isanawardfromthepartypayingchildsupport totheotherpartyforeachmonthwherehealthinsuranceisnotprovidedtothechild.

AdditionalConsiderations

Oregonchild support is thepresumedminimumofcosts to raiseachild. Honestly, for most middle-to-upper-income parties, additionalchild-related expenses are part of these parties’ lives — theextracurricular sports, higher-end clothing, cell phone plans, extensive

summerprograms,possiblyprivateschooltuition,etc.Formostpartieswhoincurtheseexpenses,thepartieswillagreetosharetheseexpensesequally, share these expenses on a pro-rata share of their salaries, orassignthemsolelytooneparty.

ElectronicPaymentvs.Garnishment

Child support is presumed to go through the Oregon Division ofChild Support by garnishing the payor’s employment check, and thenthe Division of Child Support remits a check to the payee. There aresignificant advantages anddisadvantages tousing theOregonDivisionofChildSupport.

IfthechildrenareontheOregonHealthPlanoraparentisreceivingTANForWIC,thenchildsupportisrequiredtogothroughtheDivisionofChildSupport.

TheadvantagesarethattheDivisionmaintainsanaccuraterecordofchildsupportpayments, thepartiesdonothavetodiscusspaymentswitheachother,andtheDivisionwillmodifythechildsupportawardatanytimeforasubstantialchangeincircumstancesorasrequiredbylaw.

The disadvantages are twofold. First, having worked for theDivisionwhen Iwas a pimply-faced law student, I sawmanypayor’schecksgarnishedwithoutthepaymentsbeingremittedtothepayeeinatimely fashion. Sometimes, months would go by with continualgarnishmentbutwithoutpayment.Although this isasmallminorityof

the payments garnished and paid, it does happen. Second, and moreimportantly, middle-to-upper-income individuals tend to feel ickyhavingtheirchecksgarnished.Onmorethanoneoccasion,clientshavetoldmegarnishmentmakesthemfeellikecommoncriminals.

Sowhatdopartieswhodonotwant touse theDivisionofChildSupportdo?Theysetupanelectronicdepositfromthepayor’sbanktothepayee’sbankonaspecificdayofeachmonth.Thatway,thedeposithappenswithoutonepartyaskingformoney, there isaclear recordofthetransaction,andithappensonthesamedayeachmonth.

Modifications

Childsupportcanbemodifiedanytimethatasubstantialchangeincircumstances has occurred. What is a substantial change incircumstances? A substantial change in circumstances is when eitherpartymakesmore or less income, one party is receivingmore or lessparentingtimeovernights,achildisnolongereligibleforchildsupport,oraparenthasachildwithanotherparty.

Non-ModifiableChildSupport

Asof2013,childsupportcannowbeawardedsothatneitherpartycan modify the award. I think of it as the “forever-and-ever-amen”award.Howcan thishappen? Inorder forachild supportaward tobe

classifiedasnon-modifiable, thepartiesmust(1)allowfor thecourt toretainjurisdiction,(2)citetheappropriatecaselawandstatute,and(3)waivebothparties’rightstorequestthecourttomodifychildsupportinthismatter.

Asasidenote,itisahorribleideatocreateanon-modifiablechildsupport award unless both parties are clearly, and without any doubt,benefittingfromthearrangement.

ChildAttendingSchool(i.e.,CollegeStudents)

InOregon,achildbetweentheagesof18and21whoisattendingschooliscalleda“ChildAttendingSchool”andhastherighttoreceivechildsupport.AChildAttendingSchooldirectlyreceivessupportfromoneorbothparents,dependinguponthecalculation.Thisrequirementtopay an adult child’s schooling is an anomaly, and only a handful ofstates require this typeof support.However, asmymother said, “It iswhatitis.”

Mostmiddle-to-upper-incomeindividualsarealreadypaying,orareinagreementtopay,forallorsomeoftheirchild’seducation.Ifthisisthe case, then parties can deviate from the presumed amount of childsupportandpay theactualagreed-uponcostdirectly to theschool.Allthisisdonethroughthosewonderfulrebuttalsdiscussedabove.Reasonnumber205whyyouhireaprofessional.

Regardless,itisbestforthepartiestodiscusseachparty’sintentionto pay, or not pay, for the child’s college expenses. If parties feel toooverwhelmed during the divorce process tomake this decision,whichtheyoftenare,thenthenextbestsolutionistorequiremediationinthestudent’ssophomoreorjunioryearofhighschool.Thisway,nooneissurprised,everyonehasrealnumberstoworkwith,andeveryoneknowswhattoexpectfromtheotherparty.

ChildCredits

IRS regulations allow the parentwho spends themajority of thetime caring for the children to claim the child credits for the children.However, theIRSalsohasaniftyformthatallowstheparentwith theright to claim the ability towaive that right. The right towaive childcreditsisgenerallynegotiatedbetweendivorcingcouples.

Thedivorcingcouplecandecide toeither: (1)assignthechildrento one party every year, (2) assign the children to both parties inalternating years (i.e., Rachel gets odd-numbered years and Ross getseven-numberedyears),(3)assignonechildtoRacheleveryyearandonechildtoRosseveryyear,or(4)myever-dreadedoptionofdeterminingeachandeveryyearwhoeverbenefitsmore,andthatpartythengetstoclaim the children by buying the tax difference from the other parent.Option#4isclearlyarecipeforcontinualconflict.Idon’trecommendit.

SpousalSupport

Oregon law provides that an award of spousal support may beawarded for a period of time as may be just and equitable. ORS107.105(1)(d).Hereismytranslation:SpousalsupportisavailablewhenpartyAearnssubstantiallymoreincomethanpartyBifpartyBdoesn’tearn enough to live the life s/he has grown accustomed to living.However,unlikechildsupport,whichiscalculatedbyaniftycalculator,spousalsupportisnotcalculatedbutnegotiated.Huh?

For spousal support, parties negotiate the spousal support awardbaseduponmanyfactors.

It’s time to eat a full cupcake or drink half a glass ofwine/beerwhile reading this section. Spousal support is the number two reasonwhycasesgototrial.(Thenumberonereasoncasesgototrialischildcustody). It is inyourbest interest to read thechapterwhile fullyalertandinonesitting.

Threefactorsaffectanawardofspousalsupport:

1. Howmuchspousalsupportpermonthshouldbeawarded

2. Howlongspousalsupportshouldbeawarded

3. Howtolabelthespousalsupport

HowMuch. The amount of the spousal support award dependsupon many factors, including each party’s income, either party’s

opportunityforadvancementinhis/herprofession,theageoftheparties,the budgetary needs of each party, and the length of the parties’marriage.

How Long. The length of the spousal support award is alsodependent upon length of the marriage, either party’s opportunity toadvanceinhis/herprofession,thebudgetaryneedsofeachparty,andtheageoftheparties.

Label. There are three labels for spousal support: transitional,compensatory, or maintenance. Transitional spousal support isappropriateforapartywhoistryingtotransitionintotheworkforceandfor those currently enrolled in, or about to enroll in, school.Compensatory spousal support is appropriate when spouse A made asignificant contribution to the education or career of spouse B andspouse B is now making a very healthy income due to spouse A’scontribution.The typical example is the doctor’s stay-at-home spouse.Maintenance spousal support is appropriate for a marriage where oneparty’s employment is not likely to change and the support awardenablesthepartytomaintainthestyleoflivingofthemarriage.

Don’t let your eyes glaze over just yet.Hope is found in the nextsection.

SpousalSupportAwards

Nocalculationexiststodeterminespousalsupport.So,whenpartiesnegotiate thousandsof dollars eachmonth fromoneparty to theotherparty,without thebenefitofacalculation, inevitablytheword“fair” isdiscussed.But,howdoyoudeterminewhatisfair?

Mostpeoplewantinformationtohelpthemdeterminewhatisfair.Since January 2013, I have tracked every reliable spousal support

award inLaneCounty. Icontinue to trackLaneCountyawards to thisday.Additionally,throughoutJanuary2014throughMarch2019,IalsotrackedeveryreliablespousalsupportawardthroughoutOregon.Why?IwantedtocomparethespousalsupportawardstrendsofOregontoLaneCounty’sawards.Yes,Iamthatmuchofanerd.

I dump the spousal support awards into a fancy database, whichallowsmetosortandfilterthecasesinamyriadofways.Forexample,Ican sort for only cases thatwent to trial, only cases that include childsupport,and/oronlycases fromtheOregonCourtofAppeals.Then, itapplies a fancy algorithm to the cases and tellsme exactly howmuchand how long your spousal support award is likely to be, based uponthosecasesandyouruniquecircumstances.Prettycool,huh?!

Information takes the guesswork out of determining what is fair.Youdon’tpurchaseavehiclewithoutresearchingthedatatodetermineafair price, sowhywould you not demand datawhen negotiating yourspousal support award?! No guesswork. Just beautiful, easilyunderstood,groundbreaking,leveling-the-playing-field,puredata.

The only way to get this data is through my office. My clientsreceiveaccesstothisspousalsupportdatawithoutanyadditionalcharge.Woo-Hoo!

AdditionalProvisions

Oncepartiesdetermineamonthlysupportamount,plusthelengthofthe support and the typeof support, someparties choose to adda fewmorechocolatechipsintothecupcakemix.

Somepartiescreateanon-modifiablesupportaward,meaningthat,regardless if someoneearnsmoremoneyor lessmoney, if someone ispromotedor fired,or if someone ismarriedorcohabitating, theawardcannotbechanged.

Other parties require a cohabitation or remarriage clause thatterminatesorreducesthesupportaward(i.e.,ifthepersonreceivingthesupport cohabitates or remarries, the support is either reduced orterminated),dependinguponthenegotiation.

Non-Taxable

SpousalsupportwasataxableeventpriortoJanuary1,2019.OnJanuary1,2019,theIRSchangedhowtheytreatspousalsupport.Itisnolongerataxdeductiontothepayoranditisnolongertaxedasincometothepayee.Whatdoesthismean?Itmeansifyoupayorreceivesupport,itisn’ttaxedordeducted.

LifeInsurance

Many parties require a life insurance policy on the life of thepersonwhoispayingsupportbemaintaineduntilbothspousalsupport

andchildsupportarepaidinfull.Threeoptionsexistformaintainingorpurchasinglifeinsurancetobackupasupportobligation.

The first option is for the parties to specifically identify the lifeinsurancepolicyinthegeneraljudgmentofdissolutionbyrequiringthepersonpaying the spousal support (i.e., thepayor) to: (1)maintain theaward amount (i.e., $500,000 policy), (2) indicate that the personreceivingthesupport(i.e.,thepayee)isthebeneficiary,and(3)paythepolicy’spremiums.Furthermore, thisoption requires the life insurancecompanytonotifythepayeeifthepayoreitherchangesbeneficiariesorfailstomakeapayment.Soundsgreat,huh?

WhatifthepayorwantstochangefromFarmers’lifeinsurancetoNewYorkLife?Thisdoesn’timpactthepayee,sowhatistheproblem?Theproblemisthatthepayormustobtainthecourt’sapprovaltochangethe life insurance.So?Most likely,youdonotknowhow tocompletethis“simple”requestofthecourtandthusyouneedtohireanattorneyto complete it for you. Yes, it is simple, but attorneys are not cheap,evenforsimpletasks.Assumeanychangetothelifeinsuranceprovisionwillcostbetween$500and$750.

Additionally, what happens to the payee if the life insurancecompany fails to follow the order to notify the payeewhen the payorfails to pay the premium, etc.? We use fancy language called aconstructive trust to protect the payee, but there are cases where thatfancy languagehas failed toprotect thepayee. I donot encouragemyclientstousethisoption.

The second option is for the payor to assign an existing lifeinsurance policy to the payee. The payee becomes the owner of thepolicyandthereforecontrolsthepolicy,thebeneficiaries,thepayments,and the award amount. Generally, parties negotiate for the payor toreimbursethepayeeforthecostoftheplaneachyear.Ifthepayordoesnothaveanexistingpolicy,thenthepayeemaypurchaselifeinsuranceon the payor’s life with the payor reimbursing the payee for thepremiumseachyear.

Thebenefittothisoptionisthatneitherpartyincursadditionalfeesorneeds thecourt’sapproval,and thepayee isnotat themercyof thelife insurance company following, or not following, the generaljudgment of dissolution. This is the safest option and the option Irecommendtomyclients.

Thethirdoptionistomaintainanexistinglifeinsurancepolicyandtrust that the payor will pay for it and not change the beneficiaries.AlthoughIcounselmyclientsagainstthisoption,thisistheoptiontheyregularlychooseduetoitssimplicityandcosteffectiveness.

Finally, don’t forget that if the payor dies while a child supportobligation exists, the child will qualify to receive Social Securitybenefits. Some families rely on this obligation to back up the childsupport and elect not to use life insurance. This is not available tospousalsupportawards.

Freebie

Mydivorcemediationclientsreceiveafreespousalsupportanalysisduringmediation.

7.

THINGSYOUMAYNOTHAVECONSIDERED

There are many incidentals that can happen to couples getting adivorce in Oregon. Most are case-specific. However, a few tend tohappenonaregularbasis,andmostpeople(andsomeattorneys)forgettoconsiderthesepotentialroadhazards.

PaymentsofMoney

Many times in a divorce, one party is required to pay a sum ofmoneyto theotherparty.Afewoptionsexist todocumentandrequirethispayment.

Amoneyjudgmentisanawardforthepaymentofmoneywhichhasthe following qualities. First, the payment must occur according to atimeline. Second, it creates a lien on the payor’s real property in thecountywhere themoney judgment is fileduntil thepayment ispaid infull.Third,itiscontainedinajudgment,usuallyageneraljudgmentofdissolution (many moons ago, a general judgment of dissolution wascalledadivorcedecree).

The clear advantage of using amoney judgment is that it protectsthepersonreceivingthepayment(thepayee)bysecuringthepaymentto

the realpropertyof thepersonwho ispaying (thepayor). If thepayorfails to pay the payment, the payee can foreclose the payor’s realpropertyandgetpaid.

Thedisadvantagestoamoneyjudgmentaremany.First,themoneyjudgment will impact the payor’s credit score. Credit reportingcompaniessaythisdoesn’thappen,butIhavemanyclientswhowatchtheir credit scores like hawks; it reduced their credit scores by anaverageoftwentytofiftypointsfor12to18months.Eventhoughtheymakeeverypayment,itstilldropsthescore.Themereexistenceoftheobligation lowers one’s credit score because the credit reportingcompaniesviewthepaymentobligationasanotherliability.

Second,many times the payor does not file a satisfaction at courtindicating that the payment was completed. (A satisfaction is adocumentthattellsthecourtthatthepaymenthasbeenpaid.)

Third,manytimesthepayeerefusestosignasatisfactionindicatingthatthepaymenthasbeencompleted.

Ifasatisfactionisnotfiledwiththecourt,thepayorwillhaveaverydifficulttimerefinancingorsellingtheaffectedrealpropertybecausethetitlecompanywillinsistthatthepaymentbemade(sometimesasecondtime)toprovideacleantitletotherealproperty.

So, if the payment is required to be paid between30 and 90 daysafterthedivorce,andthepaymentisnottoolarge,thepotentialimpactsuponthepayorfaroutweighthebenefitsofusingamoneyjudgment.

What other options exist? Parties can make paying the moneysimultaneous to the signing of the divorce documents, which is myfavoritemethodofrequiringpayment.Theadvantageisthatthedivorcecannothappenuntilbothpartiessimultaneouslyact.Italsohastheaddedbenefit of not requiring amoney judgment against one party. Anotheroption is to contractually agree to the payment but intentionally notrequireamoneyjudgment.Fancylegallanguagecanbeusedtoallowthepayeetocreateamoneyjudgmentifapayorfailstopay.

Anotherwaytosecureanobligationistofilealien.Alienisalegaltool to attach a payment of money to a specific real property. Thedifferencebetweenalienandamoneyjudgmentisthatalienisspecifictotherealpropertydescribedbythelienandisfiledagainstthatspecificrealproperty.Amoneyjudgmentislessformal,andalthoughtechnicallyit is supposed to impact any real property owned by the debtor in thecountyofrecord,becauseitisnotfiledagainstaspecificrealproperty,itcan be accidentally overlooked. Please see the “Bankruptcy andJudgements”sectionforfurtherinformation.

Youmaywanttoeataquarterofacupcakeaboutnow.Itisn’ttoocomplicated,butitisboring.

Money judgments and liens are not rock-solid. The sneakydisadvantageof relyinguponamoneyjudgment or a lien is that eithercanbedischargedinbankruptcyandbothcanalsobeextinguishedinaforeclosure,dependinguponindividualcircumstances.Whatintheheckdoes that mean? It means that if the payor declares bankruptcy, the

bankruptcytrusteecaneliminatethemoneyjudgmentorlienifthepayorlacksthefundstopaythedebtanddoesnothaveenoughequityinrealproperty to recoup the money owed. It also means that if the payorsimplystopspayingthemortgage,andthemortgagelenderforeclosesonthehouse, if there isnotenoughequity in therealproperty, themoneyjudgmentorlienwilldisappearwiththeforeclosure.

Inshort,a lien isbetterthanamoneyjudgment,buteithercanbeavoided by a person who both claims bankruptcy and is a party to aforeclosure.

Here is the take-away: After weighing the advantages anddisadvantages to both parties, itmakesmost sense tome to require apaymentofmoney tooccur simultaneous to thesigningof thedivorcedocumentsandnotrequireamoneyjudgmentoralien.Ifthatmeansthatthepartiesmustwait90daysfortheirdivorce,thatoptionisstillbetterthan the horrors described above. However, if the payment needs tooccur inmore than 90 days (e.g., waiting to pay themoney until thehouse sells, but it won’t be on themarket until next summer), then amoney judgment or lienmakes sense. The best option is to award theassets and the liabilities so that neither party owes the other partymoney,ifpossible.

Taxes

Uponthefinalizationofthedivorce,partiesarenolongerallowedtofile joint married taxes. So, unless negotiated otherwise, Ross’s taxliabilityorrefundishisandRachel’staxliabilityorrefundishers.Forparties who divorce mid-year or late into the year, some negotiate toseparatelyfiletaxesattheendoftheyearandthenaddupeachother’stax liability and/or refund. The party who is better off pays the otherpartyone-halfthedifference.

HealthInsurance

A divorce terminates a spouse’s ability to qualify for the otherspouse’semployer-providedhealth insurancepolicy.There isno fancylanguagetochangethisreality.Threeoptionsexist.

The first option is for the non-employee spouse to access theemployee spouse’s employer plan throughCOBRA for up to eighteenmonths from the date of the dissolution. This is an expensive optionbecausethenon-employeespouseisrequiredtopaytheemployeeshare,theemployershare,andanominaladministrativefeeforthecostofthehealthinsurance.Italsoterminatesaftereighteenmonths,soitreallyisanexpensiveandashort-termoption.

Thesecondoptionisforthenon-employeespousetoaccesshis/heremployer’shealthinsuranceplan,regardlessoftheenrollmentdeadline.Adivorce is considereda lifecircumstance thatwaives theenrollmentdeadline.

The thirdoption is toenroll inprivate insurance, regardlessof theenrollment deadline. A divorce is considered a life circumstance thatwaivestheenrollmentdeadline.

Toomanypartiesforgettotakethenewhealthinsurancepaymentsinto accountwhen determining the post-divorce budget and alsowhennegotiatingforsupport.

MaidenName

Awoman’smaidennamecanberestoredtoherduringadissolution.Thisisadecisionforthewifealone.

SplittingofFriends&Family

Mostdivorcingcouplesdonotrealizethattheirdivorcewillimpacttheirfriendsandfamiliesinwaysthatcannotbeexpected.Somefriendswere only your friends because the dynamic of one couple to anothercoupleworkedwell.However, thedynamicofonecoupletosolelythehusband orwife is not the same.Other friendswill judge one party’sbehavior in the divorce. Some families believe that once a divorce

happens, family must “side” with family, which means they cannotinteractwiththeformerspouse.

Hereisthetake-away:Yourfriendsandfamilieswillhaveexpectedandunexpectedreactionstoyourdivorce.Thebestadviceisnottohaveexpectations of anyone. You will need to approach each relationshipdifferentlybecauseyouarenottheonlyoneimpactedbyyourdivorce;yourfriendsandfamilyareaffected,too,albeitlesssothanyou.Nottosoundtoowoo-woohere,butbeopentothechangingrelationshipsandalloweveryonetimetoprocessthiseventinhisorherownway.

OneYear

Youwill be on a roller-coaster ride for one year from the date ofyourdivorce.Clientafterclientseesmearoundtownandtellsmewhatacrazyyeartheyhaveexperienced.

One client told me, “I had bouts of depression, moments ofreinvigoration, times better left unspoken and unrepeated, and morechangesthanIcouldhaveanticipated.Julie,youwarnedmeIwouldbeonarollercoasterforoneyear,andIdidn’tbelieveyou…butyouwereright.Iwasonarollercoaster,butIdidn’tknowitatthetime.Iamsohappy you advised me not to make major decisions during this firstyear.”

So,hereisthetake-away:Donotmakeanylife-alteringdecisionsduringthefirstyearofyourdivorce.Findoutwhoyouarewithoutyourformerspouse.Donotgetremarriedduringthefirstyear.Giveyourselftime.Afterall,you’veearnedit.

8.

MEDIATIONDO’SANDDON’TS

TheMediationProcess

Themediationprocessisdifferentforeverymediatorandeverysetof parties. Some mediators use a co-mediation model where twomediatorsmediate thematter.Others, likemyself, conductmediationssolo.

Therearemanydifferentstylesofmediators.Inthe transformativestyleofmediation,themediatorusestechniquesdesignedtochangehowthepartiesinteractwhentheyareinconflictwitheachother.Thistypeofmediationisverypersonal,in-depth,andgenerallytakesmuchlongerthanother typesofmediation. In the interest-based styleofmediation,themediator asksmany questions to determine the underlying reasonsfor the conflict. This type ofmediation takes time but doesn’t requireparties to change how they interact in the future. It is very solution-oriented.Intheevaluativestyleofmediation,themediatoradviseseachpartyhowtosolvetheconflict.Thinkofthisstyleofmediationas“MissBossy Pants”mediation. Finally, in the facilitative style of mediation,themediatorutilizesanystylethatworksfortheparties.Ipracticeinafacilitativemediationstyle.Iliketoblendinterest-basedandevaluativeinafacilitativemannerthatworksfortheparties.Thinkofitasfinding

thesolutionswhilereality-checkingpartieswhennecessary,butwithoutholdinghandsandsinging.

Mediation can be held either in a joint session, private sessions(othermediators call private sessions caucuses), or both. I try to keepmy mediation parties in a joint session as long as possible and onlyutilizeprivatesessionswhennecessary.

HowtoPrepareforMediation

Thebestwaytoprepareformediationistogetallyourinformationanddocumentsinorder.Makesureyouknowyourassets,thevaluesofyourassets,theaccountnumbers,andwhoisoneachasset’stitle.Printyour credit reports so that you know every liability, the value, theaccountnumber,andwhoisontheliability.Knowyourgrossmonthlyincome and your health insurance costs. Consider the costs of livingyourpost-divorcelife.Makeapost-divorcebudget,ifnecessary.Ifyouhavechildren,thinkaboutwhatisthebestparentingplanforthem.

Come to mediation knowing what you want to happen. Themediatorwillshowyouthe“how”tomakeithappen.

Evenwith all thispreparation, though,keep this inmind: It tookmany years to create this marriage and it will take many hours ofmediationtodeterminethedivisionofthismarriage.

Thenightbeforemediation,eatwell,sleepwell,andabstainfromalcoholorotherintoxicants.Hydrateyourself.Youneedtobealertandable to think during mediation. Mediation is stressful. You will needyoursleep,water,andsustenance!

Come to mediation ready to actively participate and discuss thedetails of the divorce.Be prepared to listenmore, talk less.Andmostimportantly,bepreparedthatnoteverythingwillgoasyouexpected.

TheMediationAgenda

Inmyoffice,Itendtofollowafairlystructuredmediationplan:(1)gatherinformation,(2)negotiateallaspectsofthedivorce,and(3)makefinaldecisions.

First,Imediateissuesthatrelatetothechildren:custody,parentingtime, holidays, child support, and health insurance. Next, I negotiatespousalsupport(ifappropriate).Ifindthatpartiesneedtodiscusschildsupportandspousalsupportduringthesamesession.Then,Idiscusstheassetsofthemarriage.Finally,Idiscusstheliabilitiesofthemarriage.Acolleagueofminedescribesdivorcemediationassimilartothreegamesofchesshappeningatthesametimewhereamoveononechessboardcaninfluencetheotherchessboards.So,adecisionregardingthehousecouldhaveanimpactonspousalsupportortheparentingtimedecisions.Thus,evenwithastructuredagenda,agreatmediatorebbsandflowstheagendatotheparties’uniqueneeds.

Other mediators have their own processes. Be sure to ask yourmediatorfortheagendaformediationsothatyoucanbeprepared.

Mistakes

ThereareafewmistakesIseeinmediation,namely:

Only listening to the best-case scenario from youradvisingattorney.Courts arenotorious forgivingawinto the wife on point A, but then awarding a win to thehusband on point B. So, if you are only listening to thebest-case scenario from your advising attorney on eachandeveryissue,youaresettingyourselfupforfailure—either in mediation or at trial. Unless your spouse is aconvicteddrug-dealingloser,youwon’twineverypointattrialormediation.So,be fair, cut a reasonabledealwithyourspouseinmediation,andpocketbothattorneys’fees.Noonegetsallthewins.

Trippingoveradollartosaveapenny.Whenyoufailtospend $450 for a pension valuation, yes, you are saving$450,butyouarelosingtensofthousandsofdollarsinthevaluation.

Interrupting your spouse in mediation. The mediatorcanonlyhearonepartyatatime.

Expecting the mediation will be completed in thirtyminutes. I have only conducted a fewmediations in 20years where we were completed in 30 minutes. It tookyearstocreateyourmarriage;itwilltakeseveralhourstodissolveit.

Beingmean to yourmediator. Your mediator is eitheryourallyoryourenemy.Choosewisely.Yourmediatorisnotrequiredtotakeyouasaclientorkeepyouasaclient.Ifyouareacondescendingjerktoyourmediator,don’tbesurprisedifyourmediatorfiresyouasaclient.

Expecting a divorce to make everything better. Adivorce will not make everything better. It may beemotionally freeing, but it will be financially taxing.Everythinginlifeisatrade-off.Noonegetsallthewins.

Failingtoconsideryourpost-divorceexpenses.Makeabudget. You need solid information regarding yourexpenses in order to properly negotiate for support(received or paid). Too many parties agree to pay toomuch support or agree to accept too little support baseduponalackofinformation.Youcannotnegotiateuntilyouknowtheinformation.

Blamingyourmediatorforyourdivorce.Yourmediatordid not cause your divorce. Blaming your mediator foryourdivorceisaquickwaytogetfiredbyyourmediator.

Overplaying your hand. It is transparent anddisingenuoustosuggestthatyouaredoingsomethingforthebenefitof theotherparty,when in reality itworks inyour favor. A good mediator will call you on thisbehavior.Cometomediationreadytomakefairdecisionsforbothparties.

Comingtomediationwithyourownspreadsheet.Yes,your spreadsheet will be helpful, but a mediator cannotrely on your spreadsheet and trust that it has properlyattributed financials. Nor is it likely your spreadsheetcontainsALLtheinformationthemediatorneedsforyourassets and liabilities.More often than not,when a clientbringsaspreadsheettomediationandinsistsIworkfromit,theyspendFARmoremoneyinmediationbecause(1)the client’s spreadsheet doesn’t contain all theinformation, (2) it is improperly awarding assets orliabilities(i.e.,itisdouble-dippinganassetoraliability),(3)itcontainsinaccuratevalues,and/or(4)itworksinoneparty’sfavor.

Not having the information necessary to inform yourmediatorofyoursituation.Yourmediatorcannotaccessyourretirementaccountorruna“search”foryourassets.Dothework.

Expectingnot to share theassetsand liabilitiesof the

marriagewithyourspouse.However,thisdoesnotmeanthat every single asset and liability needs to be split inhalf.Rather,thebestwaytostructureadivorcesettlementis to assign assets and liabilities to each party and onlysplit or sell the least amount of assets and/or liabilitiesnecessarytomakeafairdistribution.

Failing to share important information with yourmediator. Tell yourmediator everything.Yourmediatorneedstoknowallyourinformationinordertobestadviseyouof the lawand theways tosettleyourdivorce.Yourmediatorneedstoknowifeitheryouoryourspousehasalong-termillness,hasjustinheritedmoney,isromanticallyinvolvedwithasittingjudge,haspurchasedpropertywitha sibling, has parents who consistently remit money toeitherofyoueachyear,hasanoffshorebankaccount,etc.Why? Each scenario impacts the divorce.And yes, eachscenariohashappened inmyofficeand thepartiesfailedto advise me of the facts until the end, which changedeverything! Err on the side of telling your mediator toomuchinformation…anddoitearlyintheprocess!

Insisting on equal parenting time. Or, conversely,insistingonhavingthechildren99%ofthetime.Beopen-minded about your children’s needs and less concernedaboutyourco-workers’suggestions.

Expectingtoomuch,ortoolittle,spousalsupport.Thepayor’s attorney always thinks the payor is paying toomuch inspousalsupportand thepayee’sattorneyalwaysthinks the payee is not receiving enough in spousalsupport. That tells me the amount is fair. Heed yourattorney’s advice, but be aware of each side’s Achille’sheal.

Failingtoreviewthedivorcedocuments.

Failingtotellyourmediatorthatyouhavesoughttheadviceofanattorney.Ifyouwantthefactthatyouhavehired an attorney to remain confidential, then simplyrequest this of your mediator. However, you mediatorneeds to know the professionals on the file. Frankly, agoodmediatorcantellyouwhenyouhavehiredadudofan attorney or an exceptional attorney. Why not availyourselfofthisinformation?

Listeningtoyourco-workersandfamily.Inshort,yourco-workers and family don’t know your situation. Theydon’t know howmuchmoney youmake and howmuchyour spousemakes. They don’t know howmuchmoneyyou owe and the value of your assets. Their divorce ortheir hairdresser’s divorce isn’t your divorce. Frankly, Ispendquiteabitoftimetalkingpartiesofftheledgefrom

theirperceivedexpectations…baseduponthehairdresser’sdivorce.

Hiring an unqualified mediator. If you hire a non-attorneymediatororhire anattorneywhoclaims tobe amediatorbuthasn’ttakenthenecessarytraining,youcouldbe throwingawayyourhard-earnedmoney.Youwant tohireanattorney-mediatorwhounderstandsallthenuancesofdivorcelawandwhocanactinaneutralmanner.

Suggestions

Manypartiescometomediationwithanopenheart.However,afewpartiescometomediationwithulteriormotives.Somecomehopingthatiftheygivetheirspouseeverything,thespousewillseetheirgenerosity,miraculouslychangetheirmind,andnolongerwantthedivorce.Somepartiesattempttousemediationasadocumentpreparationservice,withonepartyclearlydeterminingeachandeverydecision.Otherscome inbody, but not inmind, and “give” the other spouse everything out ofguilt.

Mybestadvice toyou is tocome tomediationwithanopenheartandanalertmind,beprepared,andhaverealisticexpectations.

ABOUTTHEAUTHOR

JulieGentiliArmbrust isPresidentofMediationNorthwest.She isan attorney-mediator whose practice is limited to divorce mediation,adoption/guardianshipmediation.

She keeps her office well stocked with chocolate, tea, and facialtissues because divorcemediation is stressful and tends tomake youreyesleak.Julieisalwayspreparedtosupport(andsometimesdrag)herclients through their conflict and into the light. She is a gladiator ofpeace!

Julie is the proud mother of two handsome boys, two miniaturedachshundgirls,andishappilymarriedtoherhandsomehusband.Julieloves, loves, loves, food…although she still hasn’t come around toeatingsushi,muchtoherhusband’schagrin.Onmanyweekendsinthespringandsummer,shecanbefoundchasingawaterfall.