Your Divorce Finances: What’s the Difference Between a Financial Coach, Advisor & Planner?
Divorce brings financial changes, and seeking guidance from professionals can be a game-changer. Let's explore the roles of financial coaches, advisors, planners, accountants, and certified divorce financial analysts in the context of divorce, considering the costs associated with each.
Financial Coach / Counselor
Finance Fundamentals and Habit Strategies
Provides basic financial education.
Helps individuals cope with emotional challenges, including how emotions around money affect financial behavior.
Provides strategies for getting finances organized, creating good spending habits, and setting goals.
Are not licensed to provide financial advice or specific product recommendations (i.e. where to allocate your assets).
Typically charges hourly rates, ranging from $100 to $300 per hour.
Need a Deeper Dive on Divorce Finances?
This mini-course will help you get your divorce finances organized - in a weekend or less. Move forward with your divorce with more clarity and confidence. Includes a fill-in-the-blanks spreadsheet.
Financial Advisor
Investments & A Financial Plan
Provides financial advice and assists in crafting a personalized financial plan.
Considers investments, insurance, retirement, and estate planning, but doesn’t generally discuss topics outside the investments that they manage on your behalf.
Fee-based or commission-based, ranging from 1% to 2% of assets under management (AUM). Often an ongoing relationship for the duration of the financial portfolio management.
Financial Planner
Strategic Planning for the Future
Focuses on long-term goals.
Assists in creating a roadmap for the future.
Analyzes income, assets, and liabilities for strategic planning.
Fee-based, typically ranging from $1,000 to $3,000 for a comprehensive financial plan.
Accountant
Addressing Tax Implications and Documentation
Deals with tax implications of divorce decisions.
Assists in organizing financial documentation.
Ensures compliance with tax regulations.
Hourly rates ranging from $150 to $400 per hour.
Certified Divorce Financial Analyst (CDFA)
Specialized Financial Planning for Divorce
Specializes in financial planning for divorce.
Analyzes the financial impact of different settlement options.
Assists in understanding complex financial matters related to divorce.
Cost varies, but often an hourly rate ranging from $150 to $400.
Can you get a divorce without any financial experts?
Yes. If you don’t have a complex situation or large assets, you may not need one. However, you may want to consider enlisting a financial expert to help you create a financial future that helps you meet your goals in your next life chapter.
If my spouse and I already have a financial expert, do we have to get another one?
Just because you’re getting divorced doesn’t mean you or your ex must find a new expert. If you and your soon-to-be-ex have a trusted relationship with this person, they can support each of you individually after your divorce. That said, you may want to create a fresh start or clean break by working with someone new.
How to get a fair settlement?
Every situation is different, so if you and your spouse can think creatively and compassionately about how to divide your finances, you have the highest chance of a divorce where you both feel the arrangement is fair. If you two simply cannot communicate, then it’s critical to have an intermediate expert help you reach an agreement.
Need a Deeper Dive on Divorce Finances?
This mini-course will help you get your divorce finances organized - in a weekend or less. Move forward with your divorce with more clarity and confidence. Includes a fill-in-the-blanks spreadsheet.
Piggy bank image by Gerd Altmann from Pixabay.