Financial Planning Insights for International Divorce

Financial planning for you and your family’s future livelihood is a prodigious challenge in the process of international divorce — an option where you choose to divorce and subsequently reside in another country overseas.

Is it monetarily feasible for you to pursue international divorce? Recognize that while most countries make divorce possible, the agreement may vary greatly depending on where the divorce takes place. Further, be cognizant that provisions of the country where you select to divorce become applicable to all relevant financial considerations, such as how spousal maintenance, trust assets, debts, property, and other marital issues will be delineated and apportioned.

With the guidance of a divorce financial planner and family law attorney (with expertise in international divorce), you should apply the following insights to protect your interests and ensure that your family’s financial needs are addressed:

Properly analyze your family’s financial position to make informed decisions concerning your international divorce.

• How can you strategize in advance for your split with your internationally-related spouse? Note that the timing of your divorce and the financial ramifications of being divorced in one jurisdiction rather than another can be highly significant factors in the international divorce planning procedure.
• Detail past and current nationality, citizenship, and any prior marital litigation to your international family counsel and qualified divorce financial professional. 
• Make sure you report the past locations of marital residences, previous employment and affiliation with organizations. 
• Reveal any interconnections that your family has with other jurisdictions, and disclose offshore bank accounts and trust assets located across borders.
• Consider the possibility of moving assets or relocating family to other countries when devising a financial plan during your divorce. 
• Account for personal financial data pertinent to your international divorce. Gather statements and information, such as passports, prenuptial agreements, previous divorce documents (i.e. property settlement and child support orders), and federal and state tax returns. 

• Consult with a financial or tax professional specializing in forensics to discover marital assets or to obtain the proof you need to show they exist.

Protect yourself financially when handling credit and dividing international assets and debt.

• Who will be responsible to pay which debts and what can be done to enforce that your spouse pays according to your divorce settlement in the applicable jurisdiction? Clarify how and where assets are acquired over the course of your marriage to help identify any debt on joint lines of credit, which must also be divided (i.e. car loans, mortgages, and utilities).
• Be vigilant that credit rating and debt problems are resolved according to the provisions of the country where your divorce is supposed to take place. Substantiate the source of your debt issues by obtaining your most recent credit report, which will outline all joint accounts and can guide you in addressing how any international credit issues can be handled.

• Should your divorcing spouse be of international descent and you choose to split up domestically, take inventory and confirm where properties were purchased and assets accumulated. Track all account numbers and verify that the titling of bank and brokerage account statements is legally in both you and your spouse’s name before commencing with the divorce settlement process.

Evaluate prominent rules to facilitate decisions relating to international child custody, spousal maintenance, relocation, and ability to remarry.

• With the advice of an international family law attorney and divorce financial professional, you should review your jurisdiction’s guidelines to verify factors impacting your child’s custody situation and your entitlement to receive alimony and child support. Over what period of time may such spousal maintenance payments be mandated and what is the likely amount of the award? While spousal maintenance guidelines also differ from country to country, you should note that child support and alimony payments are enforced legal and financial obligations served to provide economic necessities for your children and to foster a healthy relationship in their lives.
• Most importantly, utilize the insights of international family counsel to assist in securing relocation with a child to another country or to prevent your divorcing spouse from moving with your child to another jurisdiction. In addition, seek the guidance of an international family attorney regarding recognition of a divorce decree issued cross borders if you are planning for the possibility of remarriage.

In suitably approaching your possible cross border family financial predicament, you can also check to see if alternative divorce resolution procedures (mediation, arbitration, or collaborative divorce) are available to you and your divorcing spouse. Review the tenets and resources of Collaborative Divorce to determine if this option may facilitate an amicable and effective outcome for you and your family’s unique situation.

Clearly, you can alleviate qualms about the viability of international divorce by familiarizing yourself with these pointers and becoming knowledgeable of significant financial and family implications. Be prepared and plan ahead if you are strongly considering a divorce overseas.

FPA member Elaine King, CFP®, CDFA™, Managing Director at The Lubitz Financial Group in Miami, FL. FPA member Philip Herzberg, CFP®, MSF, is Director of Media Relations & Public Awareness for FPA of Miami-Dade and FPA of Florida.