[B_&_B]

Originally Posted by ProudBFan

Yep. Knew that, crandc.

BTW, after hearing the mediator tell her point-blank several times during our session yesterday that if our case goes to court, she won't be receiving anywhere NEAR the level of support she was asking for (or even close to what I have been providing so far) - along with hearing his ideas for accomplishing most of our goals for a financial settlement - I got the best sleep I have had in MONTHS last night.

PBF

Thats good to hear... because she doesnt deserve NEAR the level of support she's asking for and what you've been providing.

Like ucatchtrout said, whats best for you will probably be best for the kids in the long run. You are the better parent.

Keep truckin' PBF!

[Ed O]

Originally Posted by ucatchtrout

Stop trying to be fair, and trying to be a good guy. Fire the mediator, hire the most expensive meanest lawyer you can find. Let him do his job. When its over, if you are lucky, the results will be fair. If you take care of yourself FIRST, you will then end up in the position in which you may best care for your children.

I totally disagree with this. For at least two reasons.

1. Divorce is not a zero sum game. Every dollar spent on an attorney is $1 less that on of the soon-to-be-ex's get. While legal representation is a great idea and obviously essential at some level, going into a divorce looking for a fight can be expensive on both sides, and even if one "wins" she/he might get less overall... even if it's a bigger slice of a smaller pie.

2. Children will notice inconsistencies between your values and your actions. Is the answer to attack first and be good later? Sometimes. Does it make more sense to try to be civil, to turn the other cheek, and to work together as best you can to reach an agreement? Personally, I think so, and I think that if those values are important ones to hand down to your children, you should live them.

It sounds like PBF is on the right track, that justice will be done (as much as the legal system can do) and that he will walk away feeling proud that he's been the bigger man and done the Right thing at every step.

Stick with it, PBF!

Ed O.

[yakbladder]

Originally Posted by Ed O

2. Children will notice inconsistencies between your values and your actions. Is the answer to attack first and be good later? Sometimes. Does it make more sense to try to be civil, to turn the other cheek, and to work together as best you can to reach an agreement? Personally, I think so, and I think that if those values are important ones to hand down to your children, you should live them.

Not sure about that Ed. Yes, he would be turning the other cheek, but whom would be suffering? If the mother of the children frivolously spends his money then the children will not have as many resources open to them. I don't think one has to be terribly vindictive but at the same time I think that PBF needs to make sure his ducks are in a row and that he's not being too terribly generous with someone who is obviously financially incompetent.

Besides, what if PBF wants full custody? He may have to put up a fight for something he believes in. Another trait that he may want them to learn...

[Ed O]

Originally Posted by yakbladder

Not sure about that Ed. Yes, he would be turning the other cheek, but whom would be suffering? If the mother of the children frivolously spends his money then the children will not have as many resources open to them. I don't think one has to be terribly vindictive but at the same time I think that PBF needs to make sure his ducks are in a row and that he's not being too terribly generous with someone who is obviously financially incompetent.

Besides, what if PBF wants full custody? He may have to put up a fight for something he believes in. Another trait that he may want them to learn...

I'm not saying that PBF should be overly generous. I'm not saying he should sacrifice. He should definitely watch out for himself and make sure his interests are cared for.

What I AM saying is that hiring the meanest, most expensive attorney is a manifestation of vindictiveness, that it will sap resources, and while it will almost certainly deprive his ex-wife of monies she is not entitled to, the cost will be too high.

At least in my opinion.

Ed O.

[ProudBFan]

Ed is absolutely right. We are purposely going about this in a way that keep as much of our money in our pockets instead of in the pockets of the attorneys & courts. That said, I *do* have one of the best divorce attorneys in the Portland area on retainer (I figure getting solid advice once is less expensive in the long run than bad advice on an ongoing basis) - and it is *his* advice for us to do as much as we can toward a settlement ourselves for that very reason.

And while I appreciate the sentiment, yak, there is just no way I will be getting primary / full custody of the children. The precedent has already been set and, as I have mentioned before here, the divorce laws of the state of Oregon are designed to protect the status quo from the children's perspective as much as possible while dissolving the marriage as completely as possible.

PBF

[Masbee]

Originally Posted by ProudBFan

We went in for financial mediation yesterday, and came out with an idea we are kicking around, and I thought I'd solicit comments on it from you guys here as well:

The gist of the idea is this: It starts with my retirement accounts. I am not going to give real numbers here, just some examples that will help explain the idea. In this example, assume that the current total value of my retirement accounts is $200K. I give her half of that right off the top, rolled into an IRA. At that point, we each have $100K of the retirement savings. I add to that an additional $60K, for a total of $160K from my retirement accounts to her IRA. Then, she turns around and pulls $50K out of what I give her (she pays the taxes on it of ~$20K) and gives that back to me. At this point, I have $40K in my retirement account and $50K in pocket for a down payment on a house, for a total asset value of $90K. And she has $90K left (after paying her taxes for giving me the $50K) in her IRA. Meanwhile, I put a 50% interest lien on the existing house. If she sells or refinances any time before our youngest is done with grade-school, I get paid 50% of the equity + gain from the sale. There would also be a few stipulations attached to the agreement:

1) She is responsible for the mortgage, insurance, property tax, and maintenance of the home from the support I give her + whatever money she is able to earn. (I will be responsible for the same on my house.)
2) If she *ever* misses a mortgage, insurance, or property tax payment, the house immediately goes up for sale.
3) The house goes up for sale after our youngest finishes grade-school in any event.

And, again, whenever the house is sold I get half of the equity + gain first due to my 50% lien.

So the net effect is that we both start out with the same amount of money from the existing retirement account. She keeps hers in an IRA, and I keep $40K in my retirement account and put the other $50K into a house of my own (has to roll *through* her as part of the settlement to avoid taking the tax hit myself). We have the same amount of money set aside for retirement, but $50K of mine is invested in my house. We also each have 50% stake in the existing house. When it is sold, I also sell my house, put some of the funds from both into a better house for myself and roll the rest back into an IRA for my retirement.

Meanwhile, the kids benefit from the stability of being able to remain in their neighborhood and grade-school district with their friends and classmates.

But like I said, this is just an idea we are kicking around at this point. We need to have a CPA crunch the numbers for us to find out if this is even feasible. We have a couple other options, too. This is just the one we are exploring at the moment. And it looks like we are going to get another 2 months worth of time to explore our options here - our court date might be postponed until February. Not a big deal though, because as soon as we can come to terms on the divorce, we can have it written up, submit it to the judge, and be done with it on our own schedule any time before the court date.

Thoughts and opinions appreciated.

PBF

I am not so sure about the idea of selling the house if she is late making payments. If you want to have that stuff in the agreement to send a message, I guess. But, you should assume it is something not to be used. "hey ex, you are late with your payment, I am forcing the sale of the house in the worst market in years, throwing away our shared equity, and making the kids move in the middle of the school year - to punish, ummm, you."

I think these principals are important:

The home the children live in is not a bargaining chip nor is it a "stick", that can be used to punish bad behavior. Judges are very reluctant to do it if it were to go there.

K.I.S.S. Don't overcomplicate things, or make a bunch of financial moves this way and that way. It seldom seems to help, just causing confusion.

Home ownership. Fine for stability. But you are getting divorced. That is not stable.

If you want to be sure the kids home is paid for, rather than pay her money, then threaten to sell the home (an action which hurts everyone, not just her) if she doesn't make the payments, why don't you craft an agreement where you send your support payments directly to the mortage company, county, etc?

Why get complicated with the retirement accounts? Why give her money to have her give back to you? Unless you are on very friendly terms, those are the kinds of strange transactions, that confuse and upset people that are (to put it kindly) easily confused and upset. It has to be really, really worth it. I know it seems straightforward to you, but it isn't.

You want cash for a down payment for a home? Why? I know few things, but one thing I would make a bet on: homes will be available in the future for the same (but probably less) cost on an inflation adjusted basis, and likely on a nominal basis, years into the future. More specifically, now has a high probability of being the worst time to buy in many years. So, what's the rush to buy? Any harm in keeping your retirement account and renting? Certainly less finanacial manuvering. And less stress. Let me repeat. Less stress. No worries about termites, leaky roofs, qualifying for a mortgage (much more difficult right now) zero or negative equity if prices drop, inability to sell when you need/want to.

[MARIS61]

Masbee makes some excellent points.

Do YOU want to be the bad guy evicting your kids from their home after you've help them stay there? BTW, have you asked THEM if they want to stay there? Maybe they'd rather move.

Although judges are hesitant to lock in how an ex spends her support, it would be good if you just made the mortgage payments ffrom the get go and gave her that much less in the settlement because:
1. I guarantee she will not make the payments and
2. I guarantee she will blow the lump sums you're giving her including the IRA.

And then you'll be expected to take the hit and bail her out again.

[ucatchtrout]

Originally Posted by Ed O

I totally disagree with this. For at least two reasons.

1. Divorce is not a zero sum game. Every dollar spent on an attorney is $1 less that on of the soon-to-be-ex's get. While legal representation is a great idea and obviously essential at some level, going into a divorce looking for a fight can be expensive on both sides, and even if one "wins" she/he might get less overall... even if it's a bigger slice of a smaller pie.

2. Children will notice inconsistencies between your values and your actions. Is the answer to attack first and be good later? Sometimes. Does it make more sense to try to be civil, to turn the other cheek, and to work together as best you can to reach an agreement? Personally, I think so, and I think that if those values are important ones to hand down to your children, you should live them.

It sounds like PBF is on the right track, that justice will be done (as much as the legal system can do) and that he will walk away feeling proud that he's been the bigger man and done the Right thing at every step.

Stick with it, PBF!

Ed O.

I understand your point of view.

So do women. They don't hesitate to go for the throat financially in divorces AND the laws in Oregon are set up to give them many advantages from the git go. Don't think that women and their attorneys don't know and exploit this as much as they can. She knew this was over and began making plans for this long before he did. And that is usually the case. The house should be sold, assets divided, and everyone moves on, is the best way to go. Ensuring he gets as much as possible out of the joint assets will help him build a solid future and a happy life for himself which will in turn enable him to be there emotionally and financially for his children.

This is between mommy and me, and we both love you to pieces. Your mother is a good person and I wish her the best. That is all the kids should ever hear from Dad on the subject. Neither parent should ever say anything bad about the other. This is standard advice recommended by all family counselors. Its a common thread that is touched upon in any book you can find about children and divorce. What is in the best interests of the children is to support them having a good relationship with the other parent. Unfortunately, many women don't understand this. They want to be number one in every way, and they will attempt to gain a superior position in the eyes of their children by telling them bad things about the other parent.

The children may not understand or agree with the things Dad has to do to protect his interests during the divorce. They will be impacted. Such is the nature of divorce. Whatever Dad has to do, they will get over.

[angrypuppy]

I no longer practice as a CPA, and personal tax planning wasn't my gig. I was in Audit and MIS Consulting.

That being said, it makes sense from a financial point of view, but Massbee is on target. Look at the way you've conducted your affairs with her since you initiated this thread. You've allowed yourself to be victimized all too often, frequently for the sake of the kids. Will you receive a duplicate bank statement every month, PBF, and place the house for sale the minute she misses a payment? You wouldn't, for the sake of the kids, and she knows it. Therefore, she will do just that, forcing you to bail her out.

That is the contingency that you must plan for, as it is inevitable, in my humble opinion. I'd have a clause added that would transfer ownership of the house to my name, at an attractive purchase price. If you set yourself up to assume all financial burden for carrying the house, then why are you splitting the upside 50/50? With the bargain purchase option, you force her to budget and make mortgage payments responsibly. This is as much a "social engineering" problem as a "financial engineering" problem, PBF.

Sorry, but I'd call the shots and take control at this point if I were you.

[ucatchtrout]

For petes sake just sell the house.

[MARIS61]

Originally Posted by ucatchtrout

For petes sake just sell the house.

Best way to go for you AND the kids.

The inevitable mess they will face otherwise when she doesn't make payments and then it takes too long to sell or you have to cheap-sell it...is a much messier result for them to deal with.

Think about it. She doesn't have a job even after all these months. It's clear working is not in her plans.

Moving to a new living situation is simply a part of your parents divorcing and a fact of life they will accept as normal as long as it is presented that way.

People move every day, it's no big deal. It usually ends up being a good thing. Meet new friends, learn new things, have new experiences.

[angrypuppy]

The house may have to be sold in time, but I'll assume that PBF is unwilling to take this action now.

PBF, take a close look at the contract. What happens if the ex misses a payment? Who has the option of selling? I'll assume it is you (take a close look though). Will ALL missed payments be taken out of her share, or your share? Remember that houses are illiquid assets; they don't always sell the first weekend, or even the first year. We have a huge inventory of housing on the market today, currently around 10 months and rising (a record, by the way). Are you covered?

What if you decide NOT to exercise that option? What is your recourse, and what is your consideration for not liquidating your house? HINT: Read my previous post. Set up a bargain purchase option, as consideration for not selling the house from under her feet. Make it your option, not hers. You can even make it exercisable the moment she misses a second payment, if you wish to be a nice guy. Further, you could have an agreement drawn up where she pays you rent directly if you exercise that purchase option (actually offset from your monthly support payment). That would force her to act more responsibly with her finances (a big problem with her I've noticed), and it would mean that your kids could stay in the house.