Co-Parenting During COVID19: Evaluating Your Financial Situation
In this episode of our weekly webinar, we talk about financial issues while co-parenting during COVID-19. We want you to make the most informed decisions possible. The best defense of the virus is information. Plus, it's essential to work with your co-parent to make sure that your kids feel protected, and their best interests are at the forefront of your decisions. Listen to the episode here.
Are you no longer receiving your child support payments?
Outside of this virus, there are a couple of options. However, neither of them is a quick fix. The faster way to get your child support and maintenance payments is to speak to your co-parent. A lack of payment of child support and maintenance payment is a non-emergency issue. If you were to request a legal intervention, it would be delayed because the courts are only taking emergency cases.
Stimulus funds
The funds are considered income for child support and maintenance payments. If you are still married, and you receive the stimulus fund, then it's a marital asset. Unemployment funds are similar to the stimulus fund – they are considered income and joint-funds as a marital asset.
Macroeconomic update
This is a social distancing recession; there's nothing inherently wrong with our financial system. Going into this pandemic, our unemployment was at a record low. We are well equipped to handle this crisis financially. We are in an excellent financial situation going into this pandemic; when we go back to normal, financially, we are well enough equipped to go out and participate in the economy. The stimulus package was so essential and enormous so that people can go and participate in the economy.
The markets are not the economy. The economy is the data that reflects how everyone is spending and earning money in their day to day lives. The market can impact the economy and vice versa; however, they are two different things. The market is more of a reflection on how people feel about the economy. The fall of the market happened before the stimulus package was in place. The moment we saw a stimulus package, people started to reinvest.
Financial Plans and Budgets
Our goal is to identify what precisely you are trying to achieve with the bucket of money. Are you trying to make a comfortable retirement, or are you trying to send your kids to college? Once you have that in place, it's easier to understand what to do with the market volatility. Take the time to sit down a put together a proper financial plan.
We are in a time of flux, understand the components of your budget, and find the areas in which you can save. Comb through your budget and understand what's in it. Work with your co-parent to find solutions in your budget. Check your credit report – has it been impacted positively or negatively?
Now is the time to understand your finances. If you haven't filed yet, and you are considering filing, now is the time to gather the financial information. You should also put together a financial plan for what your future is going to look like after this.
Questions & Answers:
· Do I pay a financial advisor to create a plan?
o Look for a financial advisor that charges a flat percentage. If your financial advisor is paid on commission, they might be incentivized to trade on your account when it's not necessary. Plus, there's a difference between creating a plan and someone who is advising on the strategy.
· Is it too late to start working with a financial advisor?
o No. It’s better to understand your options, and it is always helpful to talk to someone about your finances. More information is power.
· How can I save for retirement during COVID-19?
o Remember that this is temporary. There is a lot of uncertainty; however, we know this has a definite endpoint. Just because you might delay some of your retirement planning, don't let it completely derail you from making the right financial decisions.
· How will COVID-19 affect my social security payments?
o Go to https://www.ssa.gov and make sure you understand your eligibility.
· What about student loan payments?
o You can defer them until the 30th of September, 2020; however, make sure you check with your loan provider.
· What are the penalties for withdrawing from my retirement account?
o You can withdraw up to $100,000 from a retirement account. You have to prove that your hardship is caused by COVID-19 to avoid the penalties. This is will also depend on your age.
· Is the federal government giving more benefits to unemployment?
o Yes, up to $600 a week extra. Apply for the unemployment benefit. We have to have patience because the websites have been crashing.
· How can we get the stimulus money?
o Not everyone has received the payment yet. You will be paid in the same manner that you get your tax refund.
· What bills should I pay first if I can’t pay for everything?
o We are all in this together. There have been a lot of concessions made around payments. However, do not assume that all financial institutions are making exceptions. Look at the interest rates to decide which ones to pay first. It makes sense to address debts that are higher first.
In this Episode:
[ 7:45 ] Child support and maintenance payments
[ 9:40 ] Stimulus funds
[ 13:15 ] Macroeconomic update
[ 20:20 ] Have a financial plan in place
[ 21:45 ] Adjust your budgets
[ 26:00 ] Questions and answers
Quotes:
“The more information you have, the smarter and more informed decisions you make.”
“Child support is for the best interest of the kids.”
“Every case is different; work with the professionals and arm yourself with the information.”
“We all need to realign our expectations; the legal process will be taking longer.”
Links Mentioned:
Rider Goodwin: https://www.ridergoodwinlaw.com
Rider Goodwin on Facebook: https://www.facebook.com/RiderGoodwinLaw/
Email Caroline: caroline.kirkland@ml.com
SSA: https://www.ssa.gov
About the Guests:
Throughout her career, Kelley Rider Goodwin has been dedicated to advocating for individuals encountering some of life's most significant challenges. She is a firm believer that no individual should ever have to confront a constitutional crisis on their own and has made it the mission of our firm to deliver unwavering support to her clients.
Caroline Kirkland feels fortunate to have always done work that is interesting and challenging. From traveling the world with ESPN while working on the X Games to wealth management at Merrill, she has been fortunate to love what she does. At Merrill, Caroline works with her clients to establish and manage a thoughtful and customized financial roadmap.