Divorce = Personal Finance With Someone You Now Hate

In Podcast Episode 4 Attorney Carl Taylor and his Wife Kristen discuss the dos and don’ts of marriage and personal finance. Listen or read the transcript.

EPISODE 04

In Episode 4, January 2, 2019 Carl and his wife discuss personal finance in a marriage, communication, and how personal finances can impact a divorce, which Carl jokingly refers to as “personal finance with someone you now hate”. Below is the transcript or to listen click here: Embedded in Site Edition, Download Edition.

[INTERVIEW]

[0:00:08.4] Carl Taylor: Hello, welcome. Happy 2019 and welcome to the new and improved and rebranded Carl Taylor New Jersey Divorce and Family Law Podcast, now known as Happily Even After.

Today is a special day for our podcast because we will be doing our first interview with our “secret guest” who will be on momentarily and today’s topic is going to really focus around personal finances, how do personal finances impact a marriage, how can they lead to a divorce when not handled properly and what can we learn from those who are facing divorce or separation.

How can we learn from some of their miss-steps to make sure that we can keep track of our personal finances and not run into those types of issues. This is also important for people who have already been divorced or who are about to be divorced, if you are contemplating divorce. A lot of times personal finance issues are a big part of the problem. They’re one of the symptoms of an unhealthy marriage and you don’t have to be an economist to be good at personal finance.

You don’t have to be an expert in finance or anything else but you do have to have good communication in a marriage. You can’t have one spouse spending money and you don’t realize that they’re spending it.

You can’t have one spouse hiding assets, planning for divorce and you certainly don’t want to have one spouse taking on full responsibility for the finances in the household without any discussions because then at the time of the divorce or God forbid, if someone should pass away, the other spouse is going to have a hard time maintaining the finances of the home moving forward.

And they are going to have a difficult time knowing where the bank statements are held, knowing which assets they have, how much debt they have. So it’s really very important to have a good grasp on your finances and if you’re married to make sure that you both jointly have a firm grasp of your finances.

So without further ado, I’m going to introduce my secret guest, none other than my own wife, Kristen Taylor, who I have asked to come on as the first guest of our show. We have been married for 10 years. She’s obviously somebody who has a lot of tolerance if she’s been able to remain married to me for 10 years. But we are going to discuss some of our financial house rules some of which I have implemented just because I have always been curious about personal finance.

Some of which Kristen’s implemented because she has a good financial mind and some of which I have taken from this experience of going through more than a hundred divorces with other people, seeing how they do things and seeing some of these common threads of where people go wrong.

So without further ado, I am going to introduce my wife, Kristen Taylor, my better half. So Kristen, how are you?

[0:03:13.0] Kristen Taylor: I’m very good, thank you.

[0:03:14.7] CT: Thank you for being our ‘guinea pig’, I mean first guest on our program.

[0:03:18.4] KT: Of course, I am honored (sarcastic).

[0:03:20.3] CT: I’m sure you are, I was wondering or I was hoping that maybe you could go through sort of when we first got married 10 years ago where things stood and all the big assets I brought to the marriage.

[0:03:32.1] KT: Sure, well you certainly came into the marriage with a lot… of student loan debt. I had my own as well and even before we were married we had started to talk about planning and saving and what our view for the future was.

[0:03:47.7] CT: Yes, so I think we had about a combined $200,000 in student loan debt.

[0:03:53.6] KT: That sounds right.

[0:03:54.5] CT: Which when you are in school and you’re young doesn’t really mean anything because you just don’t know and then you get into the real world and it’s a couple of thousand dollars every month and I think very early on I started to freak out about it and you and I had to sit down and it’s like, “What are we going to do?”

And we were used to living like college students but we had to formulate a plan either just lay back and not do anything or to take drastic steps to try to get rid of it. So could you review with the audience which is probably only you and I anyway?

[0:04:28.9] KT: Sure, I think one of the things that was a big driver for us was the pressure we felt, both of us with the student loans, kind of looming, over our head. So we decided that that was going to be something we were going to take one full force and we decided that we are going to target our student loans and then we had the goal set for ourselves to pay off our student loans as quickly as possible. We knew we wanted to start a family and buy a home someday so –

[0:04:55.0] CT: Can you talk about our little spreadsheet we created, whatever it was?

[0:04:58.9] KT: Sure, so one of the ways that we were able to I think survive and come out on the other side was to make it fun or somewhat fun for ourselves. So we created a chart that every box on the chart represented a thousand dollars of our student loan debt.

[0:05:16.3] CT: So there is like 200 boxes, right?

[0:05:19.0] KT: 200 boxes on a sheet that we kept and every time we were able to pay off a thousand dollars we would actually cross off a box on the chart and it was a game for us. It kept us going and we were able to see the progress and to stay strong I think throughout the process. So we had that chart for a few years and we were finally able to pay off our student loans two years ago.

[0:05:43.3] CT: So I think one of the things we did along with that silly chart that we now have framed somewhere I am sure in our house, is every month we kind of have a sit down and say, “Here is where things are.” And I’ll admit, I probably was tighter in terms of… I was kind of like, “We can’t spend any money ever,” and you’re like, “Carl, we still have to live,” but we’d have a sit down and you’d let me know. We’d communicate and say, “Carl we need some money for this, or you’re being penny wise pound foolish.” It was a once a month kind of thing and we still do that today.

[0:06:15.1] KT: And we did that because of the planning. We would look to see what birthdays we knew we had that month, which holidays we knew we were going to have that month and what expenses were going to come up that month so that we could plan ahead and then see how much we could put towards savings. I mean we were able to do that each month and have that communication but it takes a little planning to think of the things that are coming up.

Who needs a gift for administrative assistance day, who needs a birthday party gift and planning for those things they’re –

[0:06:42.3] CT: Car breaking down.

[0:06:43.5] KT: Yeah, car breaking down, we had multiple savings accounts too that we put money into for emergency plans and planning for things that could come up with incidentals and unexpected issues.

[0:06:56.3] CT: For the purposes of this podcast which is obviously aimed at people who are going through a divorce or know somebody who is going through a divorce, I don’t want to come across like we’re bragging. I think the main reason why I have you on here Krissy was because as much as we tend to have a good marriage, there was definitely some fights about personal finance early on and I think when we were first trying to form that important base at the beginning of our marriage if we hadn’t taken the time to communicate and if I hadn’t implemented some things based upon what I see from my own clients.

Which is we really need to talk about these things and not barrier had in the sand. I mean, even if you communicate pretty well with somebody else, personal finance can really be a quicksand kind of thing.

[0:07:36.6] KT: Certainly, I was confused a first certainly and I can say honestly, I don’t enjoy the budgeting process as much as you do.

[0:07:45.7] CT: I’m like Gollum with that stuff.

[0:07:47.8] KT: I had to jump on board but it was something that you were able to show me, we were able to meet with success but it was about the communication of that because you know, I wasn’t always sure where the money should be going or what we should be focusing on and what we should be spending on and you certainly had, you know, you had the proof,  you had the ability to show me that it was working over time for us.

I also think that very quickly we had to make sure we were on the same page about what our goal was and that can be extremely difficult if your goal is not the same as your spouse’s, we decided that we were going to live a certain lifestyle for later gains.

[0:08:23.2] CT: Yeah, we bought a smaller house and that kind of stuff, I don’t impress my clients when I drive up in my Hyundai Elantra but at the same time, I don’t have a car note on it so one of the things about a divorce and I know you’re not an attorney Kristen, just to be clear to the audience, but divorce law, I guess you could kind of colloquially call it personal finance with someone you hate.

I mean, part of divorce is you have to literally go through and as an attorney I do this, we go through what’s called a case information statement, we fill out every form, we try to get an idea for what the monthly budget is for your family, what it will be after the divorce, what it is during the divorce, a lot of times, people sit there and say, I just really have no idea and you know, that’s true of a lot of people but when you’re going through a divorce.

You really have to have an idea of your finances. Whether you think you can salvage your marriage and maybe by communicating better about finances, you can or whether you’re going through a divorce, you really have to get a handle both of you and your attorneys on your finance or you’re not going to be able to divide the marital pie.

[0:09:27.2] KT: I know it’s going to sound cliché but you really need to know where the money is, you need to know every account that exist, you need to know the passwords for those accounts and you need to know how to access those accounts and if the way that today is with online bill pay and online banking, it’s even more important to know where all of your money is. If you’re not sure, those are the questions you really should be asking of your spouse.

[0:09:51.4] CT: Four or five months ago, Kristen comes to me and she says, hey, I feel like I’m sort of out of the loop with the – where we’re investing money and the passwords. You mind just making a list of everything we own and the passwords to it and being a divorce lawyer, I thought to myself, oh my God, this is divorce planning on Kristen’s part. Time will tell, I did give you a list of everything, so that goes back to the communications as well.

At the same time, you know, don’t be naïve like I am and you know, there are certain signs in the way someone’s acting that you know, you’ll be paranoid about it but they could be a sign of, if somebody starts taking more of an active interest in their finance, that’s not the case that Kristen is, because we’ve always been pretty much on the same page.

I think I was actually going to go out of town on business and she would have make sure if the plane crash, she knew how to get to my – or our savings account but you know, somebody starts taking more of an active interest, if you see somebody being shady or secretive with their money, those are all signs that they might be divorce planning and you know, I did an article Kristen, that really could put anyone to sleep on divorce in the age of bitcoin.

About how people can use some of these more high tech asset classes like bit coins in attempt to hide money. There’s really all kinds of interesting aspects to personal finance and divorce and I would also say, for anybody who is getting remarried, you want to make sure statistically, second marriages aren’t as successful as first marriages but if you’re going to get remarried, you really want to make sure you don’t fall into the same negative patterns.

Even if you’re somebody who is divorced or you’re about to be divorced and meeting somebody new is the last thing on your mind. It’s too late to salvage this marriage. Think about these concepts because I really think that communication, you know, in general is very important but in personal finance, it’s extremely important.

[0:11:39.7] KT: I also think that when it comes to being on a team together and communicating. I think it has to be a judgment free zone, we all have our own opinions about personal finance and how we want to spend our money and what our plans are, if there’s something that your spouse values as a hobby or an interest, if there’s a way that you can work that into your budget so that everyone feels that there’s something there for them in your lifestyle but at the same time, you can both be working towards your goals.

[0:12:10.2] CT: It doesn’t mean you’re going to agree on everything. I mean, I tend to invest in Vanguard type mutual funds which to Krissy I think she would probably – you’d probably like, bury the money in the back of your code, like an old lady kind of keep it in between books.

[0:12:28.7] KT: I’m a squirrel away kind of person, yes.

[0:12:31.5] CT: It’s a matter of communicating those fears and sometimes you know, they’re warranted because I’ve invested in emerging markets or something and then you see you’ve lost 40% of the asset class over the year and you go, well, maybe more of a balanced approach with some bonds or something, does make sense.

Kristen, I sort of, I think we balance each other out. It doesn’t mean that we’re always making the right decision with our finances, we definitely aren’t but we’re communicating and we kind of – there’s not that finger pointing if things go wrong. Just a couple other brief things before we go.

I wanted to talk about the importance of keeping good documents. Now, I’m very anal retentive. I actually have a program where I log every expense and every dollar that comes in and out, it’s called, youneedabudget.com I think. I’m not saying that as an affiliate or anything but that’s just what we use, it’s pretty helpful, you want nothing to do with that, right Kristen?

[0:13:24.8] KT: No, the daily input to me is exhaustive. But what I do like at the end of the month is showing where we’re spending our money. If this is something that eventually you’re facing with regards to divorce, it would be beneficial for you to see where your money is being spent, how much money is actually being spent on your children, how many Amazon boxes are arriving on your front door step.

[0:13:44.4] CT: Too many.

[0:13:45.5] KT: If you start to break it down each month, it can be a very clear picture of where your finances are being spent and where you might be able to cut back or where you may need to increase your focus.

[0:13:56.2] CT: I guess, another thing we’ll talk about is you know, when I started my business about a year ago Krissy, that adds another component to all this because now those Amazon boxes aren’t going to our house, they’re going to my office and you come to the office and you go, Carl, what are you doing, you spend a lot of money on furniture it looks like.

If you have a spouse who has a business, that’s actually an easy way to kind of lose that communication or to have your spouse perhaps deflating their income or hiding assets in the business. Has that been difficult for you that I’ve got an extra – obviously, I’m not doing these things Kristen, I promise. Is it difficult for you to, let’s say I buy furniture or how to communicate when there’s a business mixed in or even other things, you have children, should we pay for piano lessons or not. I mean, there’s a lot of balls in the air.

[0:14:46.6] KT: There are, I think that again it comes back to carving out time to speak about those things. I think you have to also be willing to ask the questions, I think some people like to blindly go along as long as the bills are being paid but I think that we both inquire as to where the things are coming from and how we’re paying for them. I think that’s another big piece is if something you feel like you’re seeing or you’re not sure where something’s coming from you need to ask.

And that’s true whether you are dual income family or a parent who works from home. It comes down to taking the responsibility of knowing where things stand. I think we do that.

[0:15:24.1] CT: The other thing I would recommend to anybody is do your best to be informed about personal finance, especially if you’re heading towards a divorce, go talk to a financial advisor, talk to an accountant, make sure that you know, if you’re cosigning taxes that – and your spouse is self-employed that it’s appropriate that they’re not hiding money from the IRS or something. I mean, really, like I said, it doesn’t take a degree in finance or anything to understand a lot of these concepts.

A lot of them are pretty basic and having that knowledge gives you confidence. I know on our website, mynjdivorcelawyer.com. I’ve written about personal finance and divorce. I’ve written about how your finances can be impacted by a divorce. I’ve got ebooks on the subject. Again, it’s something where I’m a little bit of a personal finance dork. But it’s really important for anybody, you know, whether you’re married or you’re considering a pre-nup, about to be married, understanding your finances or you’re in the thick of a divorce.

A lot of divorce, especially if you have children is really just a matter of math and a matter of calculating what alimony and what equitable distribution should be. As much as you can read about it, I think that’s a good thing to do.

Kristen, thank you so much for joining our podcast, this is our first ever guinea pig slash guest.

[0:16:41.4] KT: Thank you so much for having me.

[0:16:44.1] CT: I’ll see you at home for dinner. Hopefully you’re not stock piling those passwords.

If anyone wants to learn more, you could visit our website like I said, mynjdivorcelawyer.com or call our office, 908-237-3096. We hope that this podcast was helpful and we wish you and your family a healthy and prosperous 2019.

Thanks and have a great day.

[END]

Addressing the Emotional Side of Divorce

THE HEART OF THE MATTER – ADDRESSING THE EMOTIONAL SIDE OF A DIVORCE

Firm dog Isla is all Heart…..but she would definitely give away the farm for just a single treat.  Balancing Emotion with Proper Boundaries can lead to an optimum outcome.

            It may seem a bit odd for me as a divorce lawyer to spend so much time talking about feelings and emotions.  You may be wondering if this lawyer is some hippy lecturing about “feelings.” And of course I am not an expert on psychology–my only advanced degree is my law degree.  But in some ways I believe nobody knows more about the emotion of a marriage than divorce lawyers—not in a clinical or expert sense, but in a “common”-sense.

            When I was a small child my parents would read me a “Little Golden Book” called “Mr. Bell’s Fixit Shop.”  As best as I can remember, the book involved a proprietor of a hardware type store who would often repeat he could “fix anything but a broken heart” Later a child is heartbroken when her favorite stuffed animal is damaged.  But good old Mr. Bell fixes it for her and learns in that moment that sometime good old craftsmanship can even mend a broken heart. 

            So, although I may seem as likely a candidate as Mr. Bell on the subject of the heart (and have just as much formal training), even a cynical divorce attorney like me starts to see certain patterns.  I am much more aggressive now in suggesting that my clients seek individual therapy during a divorce.  A divorce—and particularly a contested one—is a marathon, not a sprint.  You need to be focused on your goals, you need to keep negative emotions like fear and anger at bay, you will need to eat right and essentially train like you’re about to run an emotional decathlon. 

            When I studied for the bar exam I essentially became a hermit.  I took the time to exercise every day and to eat purportedly “brain-healthy” foods like blueberries and salmon. Anyone that knows me will attest that self-control, health eating habits, and regular exercise are not my default settings.  But I knew going in that I needed all my energy to make sure I passed the bar on the first try. 

Any time spent worrying about my student loans or about a negative outcome was time not spent focusing on my single-minded goal: passing that damned bar exam on the first try.  Luckily the hard work paid off. 

Other people, some of them smarter than I failed the bar exam on the first try.  In certain instances I’m sure the reason was the stress got to them, the magnitude of the situation got to them. Why are some quarterbacks with less natural talent better in big games?  What is it in a quarterback like Nick Foles that allowed him to step up and defeat Tom Brady and his Patriots to win a Super Bowl?  I am sure that it is a great concentration on his goals, solid control of his emotions, and not letting negative emotions such as fear get to him.  When he threw an interception in the Super Bowl he shrugged it off and came back firing until the game was over and he had achieved what appeared to be the impossible.

In your divorce there will be down moments.  You will need a strong support network.  If you’re reading this book then you’re already in a good head-space: you realize that knowledge of the situation helps make stressful situations less scary. 

The more you know about the risks, about your rights, and about your responsibilities during the divorce the more you can maximize the outcome you desire. If meditation is your thing then make sure you stick with it, if you’re a runner keep running, if you believe a therapist could help then book an appointment, and if you think you’re alone remember that almost everyone going through a divorce has had similar experiences and similar thoughts. 

There’s a reason people say a divorce is worse than a death in the family.  It’s not easy but if you can control your negative emotions and stay positive, then the results should be there.  In many ways the only thing you can control is yourself in situations like this and your reaction to what is occurring.  It’s going to be over someday and you will get to your Happily EVEN after.

Don’t Be a Pushover in a Divorce

To balance some of my advice on this website about being reasonable, it should be noted that I’m not advocating that you not set properly boundaries, that you be a pushover, or that you take a bad deal.  Too often people come into a divorce either too angry or conversely too tired/guilty/whatever to properly fight for what is fair. Being level-headed and somewhere between those extremes is the sweet spot for an optimal divorce settlement. 

Misguided feelings of guilt can be some of the most troublesome emotions in a divorce.  Just because you had an affair doesn’t mean you shouldn’t be allowed to retire someday.  That is not the way the law views it—indeed in most instances New Jersey law takes no position regarding the moral high ground in a divorce. 

Divorce can be a marathon.  Too often people get worn down by the process and end up agreeing to terms they later regret.  That’s why focus and taking care of yourself is so important during a divorce.  You need to be able to put that oxygen mask over your own face first before you can go out and help others such as your children.

If your spouse has long-term serious drug problems, then fight against him having unsupervised parenting time. 

If you have reason to believe your spouse hid a large sum of money in cryptocurrency then let’s hire an expert or take whatever aggressive steps are necessary in discovery to get to the bottom of it. 

There is a difference between being reasonable and being a pushover and it’s a fine-line, to be sure.  Your divorce lawyer can help you understand when you’re being reasonable and when you’re giving in too much.  Sometimes those getting divorced have a hard time setting appropriate boundaries—that is an important part of communication—and often the leading root cause of divorce is a lack of communication or inappropriate communication.

Your children will need you to be strong for them. They are not a party to a divorce but nobody will likely be impacted more. The way you treat the divorce and how you can thereafter will be determinative in the kind of present and future available to your children.

You will get tired during the process—so will the other side. To some extent it is necessary to get worn down to the point when settlement can be reached. But if you start going through the motions or stop caring, then you should consider taking some time, a long weekend, whatever it takes to make sure you’re not making decisions that you’ll live to regret for a long time. Decisions like waiving your right to alimony, accepting less child support than your children are entitled to, giving up custody or parenting time you’re entitled to or waiving your spouse’s requirement to contribute toward your children’s college costs.

            So be reasonable, but don’t be a pushover.

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