Managing Your Wealth Through Divorce

Going through a divorce is more than just change in your personal life — it also can have a profound impact on the legal status and financial situations of everyone involved.

Marriage fundamentally changes each spouse’s rights to wealth and property, creating a complicated “yours, mine and ours” set of claims. In this respect, a divorce is not only an emotional trauma — it is also a complex, court-supervised unraveling of those claims, one that can be made easier to navigate with some thoughtful preparation.

Prenuptial Agreements

One way to prepare for the possibility of divorce is by creating a prenuptial agreement — a legal contract defining each spouse’s rights to the combined assets and support in a marriage in case of divorce. This agreement determines whether assets are held as community property, joint tenants, tenants in common or as the separate property of one spouse.

A complete and equitable picture of assets is essential. It’s important to go beyond the “lump sum” approach and instead define the present and future value of significant assets. What might appear to be an equal distribution can change dramatically when tax and retirement consequences are considered.

A complete financial picture should also take into account the risk and volatility of any assets, especially when one person may end up with too many post-divorce eggs in one basket.

Finally, a settlement should aim to maintain both spouses’ living standards and provide for their short- and long-term needs for income.

Real Estate

The division of real estate, particularly the family home, is often the most contentious issue in a divorce. But careful analysis can ease the way. You need to know the tax implications of property sales or transfers. In addition, if you or your spouse wants to buy a new home, the ability to qualify for a mortgage should be determined.

Retirement Plans

The rules governing division of IRAs and qualified retirement plans are complicated. Professional advice may be essential. For example, splitting a pension or qualified retirement plan may require a court to issue a formal qualified domestic relations order.

Taxes

Income, gift, estate and generation-skipping transfer tax planning can be significantly impacted by a divorce. Proper tax planning is essential to avoid mistakes that may not become apparent until years after the divorce, and that could lead to substantial taxes, penalties and interest.

Managing Your Wealth After Divorce

Divorce can dramatically affect your finances. You may need help in managing your assets or crafting a financial plan. If your spouse had been primarily responsible for your finances, you might feel unprepared to make financial decisions, especially during the wrenching experience of dissolving a marriage. As a newly divorced person, you might need help and advice — whether related to something as simple as opening a new investment account or as complicated as setting up a trust.

After a divorce, it’s especially important to review your estate plan. Among the things to look at are:

  • Changes in income, gift, estate and generation-skipping transfer tax laws
  • State laws and the potential elimination of provisions that favor the former spouse
  • Changes to spousal designations as executor or personal representative, trustee, attorney-in-fact or health care agent
  • Beneficiary designations
  • Estate liquidity
  • Gifted or inherited assets, or beneficial interests, whether vested or contingent

Wealth Planning for Families of All Kinds

Families today come in many different varieties. Although the financial benefits of marriage are not available to people who have children but don’t marry, they frequently can be replicated for such families. Trusts, for example, can play a critical role. They are more durable than wills and less prone to challenge, which is particularly important if other family members object to the estate arrangements.

When the financial benefits of marriage are not available, families need a legally recognized estate plan. This plan is often supported by:

  • Durable powers of attorney
  • Health care proxies
  • Wills and trusts
  • Living wills
  • Partnership/co-habitation agreements
  • Beneficiary designations

An Experienced Partner

BNY Mellon Wealth Management has a long history of helping individuals and families manage their wealth and protect their assets. We can show you how to navigate life events in ways that meet your specific needs, and work with your legal and accounting advisors to develop comprehensive wealth management plans. Whether it’s designing a prenuptial agreement, a divorce settlement, or a trust to provide for your family, BNY Mellon will work collaboratively with your other advisors to help you make the right decisions at the most important moments in your life.

DISCLOSURE

This material is provided for illustrative/educational purposes only. This material is not intended to constitute legal, tax, investment or financial advice. Effort has been made to ensure that the material presented herein is accurate at the time of publication. However, this material is not intended to be a full and exhaustive explanation of the law in any area or of all of the tax, investment or financial options available. The information discussed herein may not be applicable to or appropriate for every investor and should be used only after consultation with professionals who have reviewed your specific situation. ©2016 The Bank of New York Mellon Corporation. All rights reserved.

Endurance Coach Chris Hinshaw’s Hands Point to Progress

Posted by: Natalie Chladek
Global Newsroom

Behind every successful athlete is a coach, and for the CrossFit community’s biggest names, it is endurance coach Chris Hinshaw who has proven indispensable in guiding them to the top of the sport.

For Hinshaw, his fundamental coaching tools are his hands.

“As a coach, it’s interesting when I see photos of myself because I am non-stop pointing,” he says.  “I am very expressive in my expectations.  I put a lot of time into my workouts and decision-making into my workouts.”

Hinshaw is part of Reebok’s 2017 brand campaign, highlighted by the emotional spot, ‘Hands’ – an evolution of the company’s “Be More Human” platform. The campaign highlights how our hands tell the stories of our effort and hard work, successes and failures, and dedication to improvement.

A quick scroll through his Instagram feed reveals the same image over and over again: Hinshaw with one arm outstretched, pointing and encouraging his athletes.  The image has become so ubiquitous that many of his photos include the hashtag #fingerpointfriday.

“My fingers are all splayed out all the time, and you can see this tension in my hand,” he says.  “It’s always giving direction.”

Hinshaw’s direction has proven invaluable for his accomplished athletes, who have won the Reebok CrossFit Games multiple times and have even more victories at the Open and Regional levels.

CrossFit legends Rich Froning and Katrin Davidsdottir, as well as Jason Khalipa, Camille Leblanc-Bazinet and Tia-Clair Toomey all count Hinshaw as their coach.

Given that most of his athletes focus on functional training rather than solely endurance training, much of Hinshaw’s coaching philosophy revolves around the concept of efficiency.  Regardless of the level of athlete, Hinshaw makes sure whatever workout he assigns them gives them the maximum benefit.

“I respect people’s willingness to come to me and trust me to help them develop their fitness,” he says.  “When we go out and do something, I want to make sure my directions and what we are trying to accomplish are crystal clear.”

That mutual respect is something Hinshaw seeks in all of his athletes.  While Hinshaw’s most notable athletes are Reebok CrossFit Games champions, he coaches all ability levels, and when deciding to take on an athlete, he looks for one attribute: coachability.

“I get frustrated by athletes that have zero interest in the knowledge behind what we’re trying to accomplish,” he says.  “Those athletes may be naturally gifted, but at the end of the day without that knowledge they’re never going to build any level of confidence.  Without confidence, when I’m gone, I can’t help them.”

While his hands now help others pursue their athletic goals, that confidence played a fundamental role in Hinshaw’s own growth as an athlete.

A former All-American swimmer, Hinshaw competed as a professional triathlete for six years and notched several top international finishes, including 2nd place overall at the Hawaiian Ironman World Championships.

When Hinshaw first started triathlons, he was terrified of biking, and an accident during a training ride that busted both wheels and forced him to walk more than 20 miles home in his biking cleats left a mark on his psyche.

“It took me a long time to build the confidence, and my hands were such a big part of that,” he says.  “Early on, I gripped the bars so tight that my hands would go numb.  But I did develop an ability over time to control the bicycle to do things that I never thought I could.”

What was once a daunting skill developed into a major strength as his confidence increased.

“I was a good swimmer in the sport of triathlon, but I was a terrible runner,” he says.  “My strength which I developed and was totally a surprise was my ability to ride a bike.”

That sense of accomplishment and confidence in developing the skill proved fundamental to his success, and he now strives to develop the same in the athletes he coaches.

“That was the thing that I was most proud of, and it was only something for me,” he says.  “I went from something where I wasn’t confident, I was super hesitant, and I turned it into a strength I didn’t have before.”

How do your hands tell your story?  Let us know by tweeting @Reebok and tagging #BeMoreHuman.