Have You Ever Prepared an Expense Statement?

            I can’t cite any statistics, but I can confidently say that based on my experience, very few people have ever prepared a budget or an expense statement.  That means for most people, their income comes into their bank account and they pay their bills from their bank account, but they don’t really have a firm grasp on their monthly expenses and where their money is going.

             Expense statements can be helpful in everyday life, to understand your cash flow and itemize your expenses and have a relatively accurate overall picture of your spending habits and your financial needs.  Unless your monthly finances are unbelievably simple, I don’t know how you could have an accurate picture of your expenses without preparing an expense statement.

             Expense statements can be essential in divorce situations.  The two big financial decisions involved in divorce can be influenced greatly by your monthly expenses.

             First, how will your assets and liabilities be divided?  Without knowing what to expect for your income and expenses, you cannot make informed decisions about what assets would benefit you most.  Is it better to keep assets that have no liabilities associated with them, or retirement assets that produce future income or assets that produce immediate income?  What about liabilities?  Can you afford to keep your house, considering the expected expenses and maintenance costs?  If your liabilities are going to be divided, what can you afford to be responsible for?  Do you have room in your monthly budget for loan or credit card payments?

             Second, how will you meet your expected monthly expenses?  Do you have adequate income?  Do you need to find more income?  How about cutting some expenses?  Do you or your spouse need financial help from the other to meet monthly expenses?  What better way for either of you to demonstrate to the other that you need financial help than by documenting your income and expenses?

             Expense statements don’t need to be intimidating or complicated.  You can probably find samples online for general use and if you’re familiar with Excel or other spreadsheet programs, they can be pretty simple to prepare.  If you’re involved in a divorce situation, your attorney probably has paper forms or Excel spreadsheets with expenses listed, so you just need to fill in the numbers.  In fifteen minutes you could probably sit down and list the majority of your monthly expenses to prepare a basic expense statement.  However, with your attorney’s help and the use of forms, you can probably prepare a much more comprehensive expense statement in less than an hour.  It’s worth the time and effort.

             If you live or work in the central Pennsylvania area, including Carlisle, Harrisburg, Hershey and surrounding communities and would like to discuss budgets, expense statements or any other family law or estate planning or administration issue, please contact me.

Should I Attend Couples Counseling?

That is not an easy question to answer. Although a great deal of my practice centers around family law, primarily divorce and related financial and personal issues, I don’t like to see people get divorced and don’t encourage them to do so. So my first instinct is to say “Yes, attend couples counseling.” If you don’t want to be divorced or aren’t sure about whether you should be divorced, counseling can help clarify that decision for you. That doesn’t mean that if you participate in couples counseling then you won’t get divorced. That is one possible outcome, but it is possible that participating in counseling could help you and/or your spouse decide more definitely that divorce is the right decision for you and your family.

Even if you experience divorce after engaging in couples counseling, you may go into the divorce process with a better understanding of how and why your marriage ended. Maybe you will gain some insight that could help you in future relationships. Maybe you and your spouse will agree that even if you’re going to be divorced, you want to consciously keep your children’s best interests foremost in your minds throughout the process.  You may be able to discuss how you want to proceed through the divorce process (see my blog post about the first decision to make in divorce).

If you are not facing the possibility of divorce, but are having some relationship problems, then it may be best to participate in counseling earlier rather than later. In my experience helping clients through the divorce process, I have found that many couples wait until they are actually discussing the possibility of divorce before starting couples counseling. Not having performed a scientific study, I can only guess from my observations that counseling at that stage in their relationship was often too little, too late.

Ultimately, you and your spouse must decide whether to attend couples counseling and live with that decision. There are many qualified, experienced marriage and family therapists in central Pennsylvania, including Harrisburg, Carlisle, Hershey and surrounding communities. You can get specific recommendations from your family doctor, friends, family, coworkers, etc. If you would like to discuss couples counseling or any other divorce or family law issue, please contact me.

What is Separation and Why Does it Matter?

Pennsylvania does not have “legal separation” as the term is used in some other states. Separation simply means that spouses are either living in separate physical residences or that one spouse has filed a divorce complaint with the court and served it on the other spouse. It means you’re legally married but not living as a married couple. There are instances in which couples can be considered separated even if they’re still living under the same roof and no divorce complaint has been filed, but it is very rare for those situations to actually meet the legal test for separation.

 

Separation is significant in several ways. First, the date of separation can affect the marital value of certain assets. As a general rule, contributions made to assets such as retirement accounts after separation are considered non-marital. Calculation of the increase in value of non-marital assets during the marriage ends at the date of separation.

 

Second, separation can mean that one spouse will or could seek financial support from the other spouse. This could be an important consideration for one or both spouses when deciding whether to separate and how to do so. Separation takes the financial resources available to one household and divides those resources between two households. That generally means some financial changes for the entire family.

 

Third, separation means that parents must arrange how the situation will work for their children. Talk about a big change. Explaining the situation to children, working out schedules, trying to keep their best interests in mind can be daunting tasks and can be incredibly stressful for everyone involved. Ideally spouses can discuss the parenting arrangements prior to actually separating so they and their children can know what to expect in advance.

 

There are personal aspects to separation, like figuring out how to tell the kids and how to make parenting arrangements and how to find a place for one or both spouses to live. There are legal aspects to separation, such as the effect on identifying and valuing marital assets. Separation is not something to take lightly and should be decided with as much advance planning and cooperation between spouses as possible.

 

If you have questions about how separation or any other family law issue is treated in central Pennsylvania, including Hershey, Carlisle, Harrisburg, York and surrounding communities, please contact me.