Should we stay together until the stock market is stronger?
Should we stay together until the stock market is stronger?
Though financial experts were warning of a recession for awhile before COVID-19 started topping headlines worldwide, I think the strength and severity of the pandemic – and its resulting impact on our obviously alarmingly fragile economy – has taken everyone by surprise.
It’s definitely alarming – and more than a little upsetting – to see how quickly our entire economy has come crashing down around us. Record numbers of people are filing for unemployment, the government hurriedly passed the stimulus bill, and everyone is feeling the strain. The division of the workforce into “essential” and “non-essential” has been eye opening and terrifying.
The divide between the haves and the have nots is pretty severe, too – the have nots are working at the forefront of all of this, bagging our groceries, delivering our Prime, and serving our takeout. The lucky among us (myself included) are working from home, socially distancing, and having essentials delivered to our front doors.
For now, at least, while we shelter at home under Governor Northam’s order, we’re sort of slow. I don’t think there’s any question that the divorce business is going to come back with a vengeance, though, and, when that happens, we’ll all need to be prepared. Though I think there are certainly some advantages to filing now (like, that you’ll be able to ask for support to be awarded retroactively, and you’ll get in the front of the line and be one of the earlier ones to have a hearing after the court re-opens), I can understand that, if you’ve been laid off or had your hours reduced, you may not be interested in doing anything drastic right this minute. When you’re ready, though, I imagine you’ll have a lot of questions.
One of those will probably be this:
Should I get divorced now, or wait until the market improves?
You’re not superman; you’re like the rest of us. Your savings and investment accounts have been hard hit. If you were imagining taking a loan on your 401(k) or cashing out a small investment account, it’s worth a lot less than it was worth even just a couple of weeks ago. It definitely gives you less room to maneuver, especially in the short term.
I’m no investment expert, but taking money out of the stock market is kind of the opposite of what you want to do right now. Because then you essentially bought high and sold low, so the return on investment is…well, pretty bad.
But does that mean I should wait to get divorced until the market improves?
No. I think that, as long as you’re not planning on cashing out investments, you’re in pretty good shape. Sure, your account balances are crappier than they used to be, but if you’re just splitting the accounts, they’ll recover in time – you know, just like everybody else’s.
It’s a hard time right now, and that makes affording things (like divorce lawyers) more difficult. I get it! And, even if you CAN afford it, it’s a little nerve wracking not knowing what will happen in the future, so it probably makes you feel like you’d rather save your money. Hey, you never know, right?
There are a lot of advantages to filing – or attempting to negotiate now – even though the markets are down, and even though the courts are closed.
What are those advantages? So glad you asked. I’ll enumerate them for you.
1. If you file now, you get in line ahead of the people who are going to wait until after the courts reopen to file.
The courts are closed, but they’re still accepting filings. The cases that were scheduled are going to be continued, and the people who are filing now are going to be looking for dates. The people who wait to file? Well, they’ll have to wait.
How long? Who knows? But let’s just say that a typical back up at the court is 6 or more months, especially for longer hearings. Though you may be able to get a pendente lite hearing, you won’t be able to set a trial for awhile, and the longer you wait to file, the longer you’ll wait for a hearing.
2. We have all the tools we need to get your case settled.
We don’t need the court to do everything! So, that’s great. We have all the tools we need (you know, like WiFi, and the ability to schedule settlement conferences) to work towards that separation agreement.
We’re settling a lot of things lately (probably out of necessity, because we can’t get into court), and we’re seeing really good results. Hey, things often work out better when we don’t spend tons of money on fees to go to court!
If you can’t reach a compromise on your own, that’s okay. That’s what things like settlement conferences are for. The judges who run settlement conferences are experiencing the same things we are, and, since no one is in court, they have plenty of time for alternative dispute resolution (or ADR, in lawyer speak).
Look, it’s not an easy time for anyone. And no one can really tell you what the future will bring. Will things be better, or worse, six months or a year from now? I really don’t know. All I can say is that, if it’s over, and you’re ready to move forward, that’s not a bad decision. It may not be bad to wait, either. It’s so hard to say. I don’t think market conditions, though, should be a determining force either way. Sure, your accounts are down, and there’s less to divide, but your money is still in the market, and it’ll go up, later, when things are better. You’re dividing your money, so there’ll be less later to appreciate, but what can you do? Recessions happen.
If you have specific questions or want to calculate the cost of dividing accounts (versus leaving them in tact), maybe you should reach out to a financial professional. But, sometimes, there’s no cost worth paying to stay, and there’s certainly no award for making an unsuccessful, unhappy, or unfulfilling marriage last longer. And, of course, it probably goes without saying, but if you’re in an unsafe position, there’s no price worth the peace of mind of knowing you and your children are in a safer position.
For more information or to talk to one of our licensed and experienced divorce attorneys, give our office a call at 757-425-5200.