A colleague recently shared some training materials from Bill Eddy, founder of  High Conflict Institute.  This article shares some of Bill’s wisdom on how to help resolve conflicts by making effective proposals.

  • Setting the Stage

Most conflicts, from international disputes to divorces, have been percolating for some time. Someone has done something to someone (maybe many things, many times) and finally, one party insists that things must change.  Depending on the type of injury involved, a participant may wish to be heard, acknowledged, and apologized to before any plan for the future can be developed.  Those are crucial steps that must be skillfully handled and ….. that is a subject for a different blog post.   This article is about how former partners can begin to take concrete steps towards a different future, whether or not they have completed their reconciliation efforts.

  • “Any Past Problem Can Be Turned into a Proposal for a Different Future”

In one of many past Israeli-Palestinian negotiations, both delegations were repeatedly getting into arguments about past wrongs their people had suffered at each other’s hands.  Finally, one of the mediators offered the following insight: “If we talk about the past, one side will likely have to be ‘wrong’ for the other to be ‘right’.  If we focus on the future, perhaps we can find a way to both be right.”

 By exchanging proposals meant to achieve the desired change, we may be able to change the focus from a blame game about what’s already happened to be imagining how to go forward from this point.  Either party to a dispute may make a proposal or ask if the other person is ready to make one.  Bill Eddy suggests that, to be effective, proposals should include:

  • Who does:
  • What
  • When? and
  • Where?

Example: “I’d like to propose that we change the day we exchange the kids so that I pick them up on Friday instead of Thursday at your house”.

  • Responding to Proposals: Keep It Simple and Practical

For parties with good faith, the person making the proposal sincerely sees it as a reasonable solution to the problem being addressed, and one that the other might possible agree with.  Even if the receiving party does not view the idea as workable, beginning a diplomatic exchange of ideas (as opposed to a harsh critique) may lead to a dialogue where a different, even better mutual solution emerges.  Toward that goal, the participants should:

  1. Ask questions: to ensure that a clear understanding of the other’s proposal, and how it would work in practice.
  2. Respond with:

– “Yes”

– “No, that won’t work for me because…….”     or

– “I’ll think about it and get back to you by ……”.

Note that there is no editorializing, just a focus on what works for you, and what does not.

  • Attack the Problem, Not Each Other

Especially for disputes with a relational or historical component, our habitual pattern of interacting may lead us to an emotional reaction to a proposal we don’t like: “Are you nuts? There you go again! …. What a selfish or silly idea !”.  But, if we want to “win” (by reaching a solution to the dispute) rather than be “right” (by debating our perspective), then we must keep laser focused on resolving the problem using Bill Eddy’s simple steps: make or receive a proposal, and respond with “yes”, “no” or “I’ll think about it”.

None of this is to suggest that negotiating with our intimate partner is an easy thing just that, with the right help and techniques, it can actually be done effectively.

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Jim O’Connor, Collaborative Attorney / Mediator
3939 NE Hancock St., Ste. 309
Portland, OR 97212
503-473-8242
Jim’s Website
Email Jim

Intel is one of Oregon’s largest employers and has several different retirement benefits for their employees. Here is a list of the different plans that may exist (depending on hire date and position within the company):

  • Intel 401(k) Savings Plan: This is a defined contribution retirement account plan all Intel employees should have. Please note that it is SEPARATE from the plan below in #2 and must be divided separately if this is the agreement of the parties or the court order. It can be confusing when someone looks at the Fidelity statement, as there is a “total balance” listed, but you must ascertain the breakdown of the 401k and Retirement Contribution Plan (if listed). Hence, there is a separate cost for Qualified Domestic Relations Order (QDRO) for both the 401k and Retirement Contribution Plan described below. As a family law mediator and collaborative attorney, I try to help families streamline their retirement account and asset allocation to limit costs and QDROs to a minimum if the numbers are able to work out; The average flat rate fee for each QDRO is $600 paid to a pension attorney after the divorce, so this adds up quickly if parties unknowingly write up an agreement to divide multiple retirement accounts in a divorce.   I recently helped a family modify an agreement where they had plans to divide 5 different plans, and we helped reduce it to 2, saving the family $1,800 in pension fees alone. This plan also has a new Roth election, so look carefully at the Fidelity statement to determine the percentage (if any) of Roth holdings vs non-Roth tax deferred holdings. One caveat to understand is Fidelity will not approve QDROs where a certain percentage of Roth requested to transfer is different than the non-Roth component – it must be the same percentage for the whole portfolio.
  • Intel Retirement Contribution Plan (formerly called SERP): This plan is available to some Intel employees depending on hire date and this is another Defined Contribution Plan with a cash balance shown on the Fidelity statement.
  • Intel Minimum Pension plan; This plan is a defined benefit plan with an option for lump sum payout or monthly benefits and employees can look up an estimate of value through the Fidelity website. It is being phased out and it is my understanding only employees hired before 2011 are guaranteed payout. This is one that is hard to predict future payout so often families decide to divide any future monthly payout to eliminate risk of uncertainty, and this requires a court order called a Qualified Domestic Relations Order (QDRO). I highly recommend working with a family law mediator or collaborative law professional to coordinate this with a pension attorney for a smooth and efficient process.
  • Intel SERPLUS pension plan: This plan is relatively rare and a non-qualified retirement account reserved for certain executives or highly compensated employees.

Retirement_Savings

Other benefits Intel employees may have that fall outside of retirement, but are investment assets relevant in a divorce proceeding include Unvested Restricted Stock Units (RSUs), Vested RSUs, and stock purchased through Employee Stock Participation Plan (ESPP) twice a year. It’s very important to review the detailed vesting schedule to determine the value of unvested shares vs. vested shares as well as what may be held in ESPP shares through E-trade account. This is a complex area of the law and important to consult with a family law attorney, mediator with experience in this area, and/or a CPA or CDFA ( Certified Divorce Financial Analyst) to better understand the various options for valuing and dividing both unvested and vested shares. Another component that can be tricky to evaluate is what income should be attributed to the Intel employee for the stock benefits. We often work through these issues in mediation and collaborative divorce method to help each family arrive at a solution that feels fair and equitable to both parties.

Some Intel employees have Health Savings Accounts and it’s possible to transfer or divide this account if needed or offset it with another asset. SERMA retirement health savings accounts also exist for some employees hired pre-2014.

A lot of families choose to offset retirement with other assets such as a house or business. It is important to look at the differences in whether an asset is tax deferred (non-Roth retirement accounts) versus another asset such as cash in a savings account.  In mediations and collaborative family law cases, we often go through different scenarios to show the estimated future tax impact on various settlement options to find one that best fits each parties’ long-term goals and to avoid surprises in the tax area.

I highly recommend consulting with an attorney, CPA, or Certified Divorce Financial Analyst (CDFA) with experience in Intel cases to ensure an efficient, fair, and smooth separation or divorce. There are many pitfalls to avoid, information easily missed inadvertently, and it’s costly and stressful to re-open a divorce case after the fact if something wasn’t done properly.

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Tonya Alexander
Collaborative Attorney & Mediator
Alexander Law, PC
1925 NE Stucki Ave Ste 410
Hillsboro, OR 97006
503-531-9109

Tonya’s Website
Email Tonya

See www.YourPeacefulResolution.com for more information and additional resources.

 

 

Here are some tips for information gathering and decision making to get started in the area of retirement benefits in an Oregon divorce. It is very important to consult with a family law or financial professional in your area, and this article is meant to raise questions to better understand what to ask. It is not meant as a comprehensive or complete list as companies and plans change constantly. It’s also an extremely complex area of law, so it’s wise to use caution and obtain information from trusted sources in person before making decisions or signing agreements.

Traditional Pension Plan: Have you or your spouse ever worked for a government entity or been a member of a union? Even short periods of time are important due to the way pensions may accrue value, and often pay out over a lifetime, not to mention after death to a former spouse in some cases.

Have you seen a statement that mentions future monthly benefits or the word “pension”? These brief statements can be misleading and vague, and sometimes must be requested from the Plan and not routinely mailed out. The statement dollar figures are NOT representative of value for separation or divorce purposes. The actual value is typically much higher than what is stated, and PERS is a good example. It’s extremely important to understand.

  1. Are you dealing with a defined benefit plan (pension)?
  2. Are there survivor-ship annuity options?
  3. What is the present value with and without the survivor-ship benefits?
  4. Is the pension 100% marital or are there any pre-marital components?
  5. Have you and your spouse been separated for a long period?
  6. When would the pension pay out start and what are both spouses ages and health? Age and health can be a significant factor for planning and decision making.

To answer these starting questions, it’s strongly recommended to have a licensed actuary or pension attorney complete a present value actuarial analysis. This needs to be coordinated through your mediator, CDFA (certified divorce financial planner) or divorce attorney. I often co-mediate or collaborate with a neutral pension expert to help clients value pensions and answer questions for families. These tools help clients decide what makes the most sense to accomplish mutual family goals and to maximize benefits for long term planning. Often, there is a mutually beneficial method of dividing or offsetting a pension that meets both parties’ needs.

Or, once a valuation is done, perhaps the participant decides to retain a pension to keep it intact for future source of income, and instead offset it with another asset. There are tax implications and other factors to consider, so it’s important to evaluate the pros and cons of each alternative along with any risks. We also have software tools such as Family Law Software used in mediation and collaborative cases that can help analyze cash flow and asset allocation to help families make the best decisions.  If done thoughtfully in the mediation or collaborative context, the process can be affordable and be done out of the litigation or court setting very quickly. In mediation and collaborative method, we also use a neutral professional to avoid the “battle of the experts” that litigation attorneys often end up with in court costing both parties far too much money, stress, and time.

Some divorcing couples oversimplify or completely overlook the pension piece, and I have seen PERS pensions worth almost $1 million be inadvertently waived by a party for various reasons. It can be fear of conflict, fear of cost to value or divide, fear of complexity, or just naivety on what a pension consists of. Most pensions (qualified under ERISA) are divisible by stipulated court order due to the separation or divorce in a very simple process called QDRO or COAP depending on the plan.

Your divorce mediator or attorney can help coordinate this piece for your family, so it goes smoothly and affordably. For example, a complete valuation of a pension is typically $400 flat fee. Cost to divide a pension is typically $600, and these fees are often shared by both parties equally.

Lastly, I have seen many instances over years of practicing where a person divorced years ago but did not follow through with the proper court paperwork to complete a pension division and they are completely unaware! This is another caution to work with an experienced family law specialist, whether it be an attorney mediator, collaborative attorney, or specially trained CDFA. Many areas of family law are designed for self-represented parties to navigate fairly easily through the court paperwork, but this is NOT one of them. Military and federal pensions have their own complexities and related benefits that are important to get specialized advice about.

To learn more about how to divide pension plans the Collaborative Divorce process, contact one of our Professionals at Bridges Collaborative Divorce Solutions.

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Tonya Alexander
Collaborative Attorney & Mediator
Alexander Law, PC
1925 NE Stucki Ave Ste 410
Hillsboro, OR 97006
503-531-9109

Tonya’s Website
Email Tonya

Stay tuned next for Part 2 on Intel® Retirement Benefits