Family Risk Management – 3 Important Tips
I was on a plane on my way from London, England back to Toronto, Canada. After the meal was served, my seatmate engaged me in the development of his risk management business. He explained that in his industry the identification of risks was the easy part. Most of his time was the anticipating and monitoring of likely future events which may deflect resources from business operations. Family law risk management faces other concerns.
Family Risk Management
For those of you who negotiated domestic contracts such as cohabitation agreements (or “prenups”), and separation agreements there may be obligations that continue after the documents are signed. Don’t toss the document in your safety deposit box and forget about it.
To reduce the risk of missing important deadlines to act or critical dates to review your support obligations, follow these 3 tips:
- Make a copy of the agreement and enter the important dates in your virtual calendar:
- Installment payments due dates: are they being met? If they are late are you entitled to interest?
- Annual review dates of child and or spousal support payments when you file your tax return: Look over the whole return not only line 150 income from all sources;
- Your employer bonus dates: does the new amount trigger a ‘material change in circumstances’? Is the bonus paid in dividends which form a significant part of your income? Are there any repercussions to know about?
- Does your child’s progression to grade school or to high school prompts a change in the pattern of overnights or parenting arrangements available to you?
- Annually review the events which may initiate a reduction or termination in your support obligations such as the recipient’s financial self-sufficiency or a child’s marriage.
- Pay for an annual one-hour consultation with your family law lawyer.
If your circumstances are complicated, make it a quarterly check-in.
Take a copy of your agreement with you. Provide a complete update on your personal circumstances which have changed since the signing of the agreement. Talk about your dreams and goals and when you can actually realize them.
If you had a toddler when the agreement was signed and now 7 years later you are considering retiring from your company, meeting with your lawyer will reveal the possible risk that you may be facing the same level of child support despite your dream to step out of the workforce. Learn how to manage the impact.
- Are you formalizing the changes in an Amending Agreement?
If the annual amount of child support changes significantly, execute an Amending Agreement as soon as possible. If daycare is over, draw up and sign an Amending Agreement.
The cost of a few hundred dollars to have a family law lawyer draft this simple agreement is money well spent. In Ontario, if a dispute arises and the signed domestic agreement is filed with the proper court, the amounts of support and special and extraordinary expenses specified in the agreement are the ones which will be enforced by the Family Responsibility Office. For example, if the private school was terminated, and no subsequent Amending Agreement was entered into by the parents confirming the withdrawal of this hefty expense, the FRO will enforce the payment of this expense until resolution of the issue.
Take the time to understand family law risks inherent in your domestic contract and take action to effectively manage those risks. To learn more about the family risk management please contact Lorisa Stein directly