How to Choose Your Divorce Financial Professional

Selecting the right professionals to help you through your divorce process will be critical to your outcomes and your future. Knowing what to look for, what questions to ask, and what answers are acceptable will help you to evaluate potential providers effectively – and choose the professional who best meets your needs, as you define them.

Divorce financial professionals are specialists. Just as surgeons first become medical doctors, then choose a surgical specialty, financial professionals follow a similar career path. To continue the analogy: you would not want your primary-care physician to perform your open-heart surgery; you want a cardiac surgeon, a specialist. Likewise, when you need a divorce financial specialist, a general financial professional just won’t do. Specialists have specialized knowledge and training.

Divorce Financial Professional vs. Financial Advisor or Accountant

If you were to ask your financial planner or accountant to assist you with your divorce in some way, not only may they not be specifically qualified to do so, you may present them with an ethical problem by making that request. They will want to be responsive and helpful, and they will do something, even if it may not be what you need. In addition, if you have joint accounts with your spouse, or file joint tax returns, your request presents a significant ethical dilemma regarding how to provide equal and unbiased service to both of you. That is something which is nearly humanly impossible, and they will most likely fall short of doing so. The best thing they could do would be to refer you to a divorce financial professional.

What Is a Certified Divorce Financial Analyst® (CDFA®)?

The Institute for Divorce Financial Analysts^® (IDFA^®) is the pre-eminent organization dedicated to the education and certification of divorce financial professionals. The certification conferred on successful candidates is Certified Divorce Financial Analyst^® (CDFA^®).

First and foremost, your divorce financial professional ought to have already been a financial services professional, such as a financial planner, financial advisor, or public accountant. These professionals routinely work with other clients, regarding various aspects of personal finance, over extended periods of time. In a few rare cases, attorneys or paralegals have also earned the CDFA designation. Since you will also have a divorce lawyer, remain focused on finding strong financial expertise. The IDFA website states that: “The CDFA is someone who comes from a financial planning, accounting, or legal background . . . CDFA practitioners must have a minimum of three years work experience in a financial or legal capacity prior to earning the right to use the CDFA certification mark.”

Know that you have the right, and owe it to yourself, to ask questions when contemplating hiring a professional who will play a key role in the determination of your future financial well-being.

Questions to ask a Divorce Financial Professional:

• How long were you a financial planner or accountant before becoming a Divorce Financial Professional?
• Do you continue to provide financial planning or accounting services today?
• What prompted you to develop the divorce finance specialty?
• What other non-financial sources of income do you currently have?
• What percentage of your total income is from non-financial work?
• What percentage of your work time is spent on non-financial work?

Again, solid professional experience in financial planning or accounting provides the foundation and underpinnings of a highly qualified divorce financial professional.

There is one additional Canadian divorce financial certification: Chartered Financial Divorce Specialist (CFDS).

Questions to ask a Divorce Financial Professional about their Certifications:

• Did you study the coursework for each certification you claim?
• Did you actually take, and pass, each exam for these certifications?
• When did you test for each of them?
• Have you continued to keep your continuing education requirements up to date for each?

Because most divorce financial professionals are financial services professionals, the IDFA (the primary certifying organization mentioned above) relies upon a practitioner’s existing record as an indication of character and depth of financial knowledge. From the IDFA website: “In order to become a CDFA professional, a candidate must . . . be in good standing with his or her firm or broker/dealer and any governmental regulatory agencies . . .”

Questions to ask a Divorce Financial Professional about their Standing:

• Are you subject to oversight by any governmental regulatory agencies?
• What are they?
• Do you have any reportable events or violations on your record?
• Where may I read about any reportable events or violations, or indication of none?
• Do you consider yourself to be in good standing with all licensing and/or regulatory authorities to which you are subject?
• If none of these questions apply to you, tell me again, what makes you a financial professional?

Overall, know and understand the competencies of your divorce financial professional. Having studied finance in school or worked as a bank teller is simply not the “professional financial services experience” you require.

Additional criteria for Collaborative Divorce Financial Practitioners

If you are interviewing divorce financial professionals for your collaborative divorce team, you need someone with even more additional specialized training. The International Academy of Collaborative Professionals (IACP) outlines minimum standards for Collaborative Financial Practitioners as having: “Professional license . . . in good standing . . . that requires a broad-based financial background and continuing education, and that is regulated by a governing body under a code of ethics . . . Background, education and experience in . . .” followed by a listing of a number of financial services areas apart from the financial aspects of divorce.

Questions to ask a Collaborative Divorce Financial Practitioner:

• What specific experience do you have, outside of divorce financial work, in the areas of:
  • Cash management and spending plans;
  • Retirement and pension plans;
  • Income tax;
  • Investments;
  • Real estate;
  • Insurance;
  • Property division; and
  • Individual and family financial planning concepts?
• How long have you been doing this type of work?

In addition, the IACP requires specific education in the “financial fundamentals of divorce giving the financial professional a basic understanding of family law.” This requirement is met by successfully earning and maintaining the financial divorce certifications discussed above. Therefore, even a highly qualified financial services professional cannot be trained in or practice collaborative divorce without first being certified in the finances of divorce specialty.

The IACP further requires that Financial Practitioners have “interdisciplinary Collaborative training,” as well as specific “client-centered, facilitative conflict resolution training” of the type typically taught in mediation training. All practitioners are also required to be current regarding continuing education requirements in all areas.

Questions to ask a Collaborative Divorce Financial Practitioner about their Training:

• Have you completed specific interdisciplinary collaborative training? When?
• How long have you been practicing in collaborative divorce?
• Have you completed conflict resolution training? When?
• Are you current in all continuing education requirements required for collaborative practice?

In summary, a prospective Financial Neutral – the title for the financial member of your collaborative divorce team – must first be a financial-service professional, then be certified as a divorce financial specialist, then additionally be trained as a collaborative practitioner.