Secrets to Creative Solutions for Divorcing Couples

Taking a cookie-cutter approach to reach an out-of-court divorce settlement isn’t a good idea. Every divorcing person has unique needs, desires, and circumstances that should be specifically taken into account when crafting this all-important document. Yet because many couples don’t realize the extent of creative solutions available to them, they often turn to generic resolutions that don’t truly address their needs or goals.


Many collaborative divorce lawyers, mediators, and financial specialists are experts in seeking creative settlement options and solutions. Nancy Hetrick, a Certified Divorce Financial Planner, says that coming up with innovative solutions for her clients during settlement negotiations is one of her favorite aspects of the job. “Almost every single couple that we work with at some point during the negotiation will say: ‘We can do that?’ I say, ‘Yes, you absolutely can because we’re really thinking outside of the box [asking ourselves], how can we make things work?”

 Listen to the full episode of Divorce Dialogies featuring Nancy Hetrick.


Even within the constraints of state and federal law, you can get creative in your financial settlement in multiple areas and in countless ways. Below are a few examples of the type of original thinking and solutions you may want to consider in your divorce negotiations.


Real Estate. Hetrick has become a specialist in finding solutions for the family home upon divorce. Many people, especially those with kids, don’t want to give up the family home, yet they can’t afford to make mortgage payments on a single income. To resolve this problem, she has created agreements where the couple agrees to continue owning the home together until after the kids graduate from high school. Afterward, they contract to sell the house and split the profits.

Cash-out refinancing is a creative real estate solution for situations where one person wants the family home but can’t afford to buy their spouse’s share of the equity. Cash-out refinancing is when one party refinances the mortgage for the remaining amount plus the portion of equity owed to the spouse. Let’s say that a home is worth $300,000 and has a remaining mortgage balance of $50,000. The spouse who wants the house would refinance the mortgage for $175,000. This amount would cover the $125,000 in equity owed to the spouse and the remaining mortgage, and would be transferred to the spouse in cash.


Pensions. Pensions are another area ripe for creative settlement. A skilled lawyer or financial expert will get to know the plan thoroughly, understand the plan requirements for division, and assess the choices available to the couple. “You can get so specific,” says Hetrick. In one case, Hetrick’s client’s pension had an annual cost of living increase that became a separate item for negotiation and asset trade.

For example, Hetrick’s team considered splitting the core pension amount between the couple but awarding the cost of living increase only to the non-owner in exchange for an equivalent asset. Another option was to give the owner the cost of living increase while awarding the non-owner $100,000 in cash upfront. “Knowing the exact value of things…opens up a world of choices,” says Hetrick.


Spousal Support. Alimony arrangements generally can be short-term, long-term, permanent, or anything in between. This flexibility allows couples to form an imaginative spousal support settlement fair to both parties. For example, if a couple decides that support will last for a finite period, they can be creative about the circumstances upon which the support will end. They may decide that alimony will terminate when either spouse attains a certain age, the children reach a certain age, the supported spouse completes a specific educational or training goal, or upon the occurrence of some other event that makes sense for them.


Couples can also decide how to end the support. Some divorcing couples may agree to gradually reduce the amount of spousal support, allowing the supported ex-spouse sufficient time to establish a firmer financial footing and slowly adjust to receiving less support. Others may decide that an ex-spouse will receive regular support payments for a fixed period, then end with a final lump sum payment. Talk to an experienced divorce lawyer or financial expert specialized in divorce to discover your options.

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If you’re considering divorce and would like to develop a creative divorce settlement that might mean a brighter future, contact my team at Miller Law Group or call us today, to schedule a confidential consultation.

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