When divorce looms, most people fixate on the emotional fallout or legal battles ahead – rarely do they understand how profoundly financial decisions made during this vulnerable time will shape their future for decades to come. Host Cary Jacobson sits down with Melissa Murphy Pavone, a Certified Financial Planner and Certified Divorce Financial Analyst who brings mindfulness to the dollars and cents of divorce.
Whether you're considering divorce, in the middle of negotiations, or about to sign your settlement, this episode illuminates blind spots that could cost you thousands.
Visit jacobsonworkshop.com to learn more.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Melissa Pavone (00:00):
Sometimes they get brought in in the middle of
a case and that could just belike they're seeing, you know, a
mediator like yourself,attorney, and they're like, hey,
you know, we're almost there,but we're stuck on this one
issue.
So sometimes the attorneys andthe mediators call me and say,
hey, like we're really good, wegot the parenting plan, you know
, but we're just, we're not surehow to deal with this family
(00:21):
owned business.
Or we're thinking aboutoffsetting the equity in the
house with a retirement account,but we want to take taxes into
consideration.
Can you help?
Intro/Close (00:32):
Welcome to Divorce Diaries, where attorney Cary
Jacobson brings you real stories, hard truths and practical
advice on navigating divorce andfamily law.
Whether you're going through it, considering it or just curious
, this is your place for clarity, confidence and resilience.
Cary Jacobson (00:54):
Welcome back to another episode of Divorce
Diaries Lessons from theTrenches, where we explore the
challenges and lessons that comewith divorce and highlight
professionals who are making adifference in the space.
I'm so excited to have MelissaMurphy Pavone, who is a CFP as
well as a CDFA and founder ofMindful Financial Partners, as
(01:17):
our guest today.
Melissa has spent over 18 yearsguiding clients through all
kinds of life transitions,everything from launching
businesses and changing careersto marriage, divorce and the
loss of a loved one.
She helps people get crystalclear about what they want out
of life and then build financialstrategies that support those
goals.
Melissa, welcome to the podcasttoday.
Melissa Pavone (01:43):
Thanks so much for having me, Cary.
Cary Jacobson (01:45):
Absolutely Well.
I'd love to just dive in, and Iwould love for you to start by
telling your story and talkingabout where mindful and mindful
financial partners comes from.
What does that mean in thecontext of financial planning
and how does it shape the waythat you work with clients?
Melissa Pavone (02:06):
and how does it shape the way that you work with
clients?
Absolutely so.
My career has been in many bigfinancial firms and they were
very much focused on yourbalance sheet and they weren't
as focused on the human in frontof us.
And I think that there was a bigdisconnect in the financial
world of being able to give truefinancial advice, because there
(02:28):
was an asset minimum right thatyou needed to get in order to
have that financial advisor andthat fee threshold and it just
wasn't in alignment with who Iwas and how I wanted to run my
practice, who I was and how Iwanted to run my practice, and I
think it's really important, nomatter how much money that you
(02:49):
have or investable assets, thatpeople really need true guidance
, and I really look at it from aholistic standpoint, and that's
where I want to work withpeople who really want to become
in alignment with what they'respending and where their money
is going, and I think it'sreally important, and so that's
where Mindful Financial Partnerscame from and from that became
Mindful Divorce Partners, whereI really help people go through
(03:13):
divorce but really educate themand empower them along the way,
because, as you know, divorce isnot just a legal issue or an
emotional, but it's also afinancial separation that you're
going through.
So taking that pause, reallydoing some inner work and
thinking to yourself like, hey,what does this mean to me now,
(03:34):
to my family and in the future,and how these decisions impact
your whole life right,absolutely so.
Cary Jacobson (03:42):
How do you work with a client who is going
through the divorce process anddo you have a team of
professionals that support themthrough that?
Melissa Pavone (03:54):
Absolutely yeah.
So Mindful Divorce Partners youknow people often ask me like
when's the best time to hire aCDFA?
And for those of you who don'tknow, cdfa is Certified Divorce
Financial Analyst, and so Ispecialize in the financial
aspect of divorce and sometimesthat's dividing assets and
sometimes that's planning for,you know, a change of income or
(04:19):
support payments and how weoffset some of these assets
right and how we divide a housein two or a retirement account
in two or a business in two,which, as you know, gets really
complicated.
So I, along with my team, gothrough and the mindful piece
really is the financialtransparency.
(04:41):
So it's very important to methat before people make any
financial decisions, they havethat financial transparency.
So we want to know what we haveright.
I always say you need to knowfive numbers before you get
started.
It's your assets, what you own,your liabilities, what you owe,
your income, what you earn,your expenses, what you spend
(05:04):
and your credit score.
And those numbers will reallyhelp guide you towards making
the best decisions for yourfinancial future as you go
through divorce.
And sometimes I can get yeah,sometimes I get brought in in
the very beginning of a case,right.
Sometimes I'm the first phonecall.
(05:26):
And sometimes I look at divorceas like a three-prong approach.
There's the emotional, thefinancial and the legal.
So sometimes if I'm the firstphone call, I often say like hey
, are you seeing a divorce coachor a mental health professional
?
Are you really ready to takethis next step, or are you just
kind of dipping your toe in thewater and then that will
(05:47):
determine if they're ready towork with me?
Or you know, here I have a listof recommendations for other
professionals that can helpsupport you until you're
emotionally ready to make thatnext, you know decision.
And sometimes they get broughtin in the middle of a case and
(06:16):
that could just be like they'reseeing you know a mediator, like
yourself, attorney, and they'relike, hey, you know, we're
almost there, but we're justwe're not sure how to deal with
this family owned business.
Or we're thinking aboutoffsetting the equity in the
house with a retirement account,but we want to take taxes into
consideration.
Can you help us?
And then the third part is kindof that post divorce.
(06:36):
Like, hey, I'm about to signthis paper, not really sure what
all this means.
Like, can you just do a onceover, right?
Just like you guys have reviewattorneys to kind of look it
over.
I offer like a one hour.
Just like, hey, what does thislook like?
Am I going to have divorceremorse?
Like, am I missing somethinghere?
Can you look it over?
So it really depends where youare in the process.
Cary Jacobson (06:57):
And where a.
Cdfa can help you the the onceover is an interesting concept.
Concept is it that before theyactually signed their settlement
agreement?
Melissa Pavone (07:12):
yeah.
Yeah, it's just as if you, likewe, were saying, hey, go get a
consulting attorney, like andsometimes it's hard right,
depending if you're the mediatoror the attorney, whether you're
, you know, an advocate orneutral to be like, hey, there
might be that power imbalancehere or a financial literacy
imbalance, and that's kind ofwhere I like to come in and say,
hey, you might not be the CFOof the family, right, you might
(07:36):
not have made all the bigdecisions.
Perhaps you were the one thatdid the day-to-day and, you know
, did the food shopping and allof like the kids' activities,
but not necessarily who theaccountant is where the
investments are where theinsurance is held, and so I
really like walk my clientsthrough that, understanding what
(07:58):
they have now andwhat they could have later after
that process.
So it's really important forpeople and sometimes, honestly,
they're intimidated, right?
There's some shame in coming tothe table and not knowing, and
I want to like get rid of thatshame, excuse me, and tell
people like it's okay, we'rehere right, like we're here,
(08:20):
we're going to move on.
You're going to always knowwhat your numbers are after this
, but let's align you withprofessionals that really want
to educate and empower you sothat you can make the best
decisions moving forward.
Cary Jacobson (08:32):
Absolutely, and this is something that I see
regularly, especially when I'mworking with couples in
mediation.
You know, I do a typical initialconsult and one of the things
that I'm trying to gauge is doboth people feel like they have
the information about thefinances and were both people
(08:55):
involved in being the CFO of thehousehold or at least
understanding what all of theassets are?
And when I find that there isthat knowledge imbalance about
the assets, then I really do mybest to make sure that they are
both, you know, have thattransparency, and one of the
things that I try to do is putit more on the onus on me so
(09:21):
that I can see what's kind ofgoing on.
And so we do like a sharedDropbox of all of the
documentation so that I canbetter kind of explain it.
And if I find that it's goingto be helpful for the couple to
reach a resolution, I willabsolutely recommend working
(09:41):
with a CDFA so that that personcan get knowledge, because I
don't find that you can reach aninformed decision on how these
assets are divided untileverybody's on the same page.
Melissa Pavone (09:55):
That's so good, they're so lucky to have you,
because not everybody, noteverybody does that and goes
through that extra step.
But I think and sometimes ittakes a little longer on the
front end but it makes for abetter settlement, right and a
long term solution, so that theydon't come back in a year and a
half and say, hey, this is notwhat I thought it was, this is
not going to work for us, likeyou know, and and then we'll
(10:19):
have to reopen their case again.
So I think, a little bit moreplanning and it's I call it like
the power of the pause, right.
Like, let's just pause.
Make'll say, oh, this is worth$100,000 and it could be a money
market account, and thenthere's equity in the house, and
(10:45):
then there's a 401k, and thenthere's a Roth IRA, and all of
those things can have a snapshottoday of $100,000.
But they're all not createdequal, right, we can't access
them the same and theconsequences aren't the same.
And so, therefore, I try toplay that what if game right,
like if we're going to trade Xfor Y, what does that really
(11:07):
mean?
And what's the pros, what's thecons, what's the tax
consequences for trading theseassets one for another?
Because when you're in it, it'sso hard to see past the day
you're not thinking about howthese decisions are going to
impact your future 5, 10, 20years down the line.
(11:28):
So I'd like to you know, as aCDFA, very empathetic.
This is a very hard time inyour life, but zoom out and look
at the long-term implicationsof these decisions and make sure
that you know.
You know the good, the bad andthe ugly.
Cary Jacobson (11:45):
Right, and I think the one that I see the
most often and gets to be one ofthe most complicated is one
spouse wanting to keep the houseand the other spouse using
retirement assets to kind ofoffset that, and so it is very
(12:06):
much a challenge in making surethat they both are aware of what
those consequences are.
Melissa Pavone (12:15):
Yeah, and again, that's one of the biggest
things I see too right, thehouse and oftentimes the house
is the largest asset between thecouples, right, and you can't
divide it in half, although I'msure people have tried,
especially where interest ratesare currently versus where we
all refinanced that a few yearsago, and it really, it really
(12:36):
changes the conversation of youknow, can we afford to get
divorced?
And a lot of people, I thinkthat's their fear and the fear
comes from the unknown right,because they don't know if they
can afford it.
They're thinking, hey, we havethis one house, two incomes.
We're barely making it.
Intro/Close (12:55):
How are we going to ?
Melissa Pavone (12:56):
do this on supporting two households and
that's really hard.
So I think that financialclarity piece is helpful and I
offer like a small limited scopepackage to go over that
financial clarity piece andwithin those three hours of
working together sometimespeople say, hey, you know what,
(13:16):
this isn't as bad as I thoughtit was right, I can do this.
I'm going to contact Cary andstart the process.
Or some people say, hey, youknow what, I need to save a
little bit more, or I need tospend a little less, or I need
to get my credit score up untilI'm able to make this work.
And so they do some work buteither way, they have that
(13:38):
education piece and kind of seewhat it could look like.
But oftentimes with the house Iget it right Because the house
is not the same and it's easy.
That retirement money you didn'tspend Christmas or the holidays
with that retirement account.
It's kind of numbers right on apage and letters and you don't
(14:00):
have that emotional attachmentto it, you don't have the
memories that are there, youdon't have the physical stuff
you know, and so I think that isa hard piece to you know, we
have to take that emotionalstandpoint in.
But I often caution people whenthey are saying, hey, I'm going
to forego alimony or I'm goingto trade retirement equalization
(14:25):
for the house.
Can you really afford to keepthis house?
Because you might be able toafford your mortgage today, and
just the mortgage.
But are we taking intoconsideration if the boiler goes
, if you need a new roof, like,are you going to have that
emergency fund on one income nowin order to be able to afford
(14:50):
these big ticket items thatbefore you had a two income
household to support?
So I always try to go throughthat what if?
Analysis to make sure it reallymakes sense.
And sometimes and I'm not sureif you've seen this before, but
like I like if you can co-ownthe house for a few years,
depending upon where your kidsare at and if you know it's an
(15:10):
amicable situation sometimesthat's the best bet because you
only have a few more years andyour kids are almost graduating,
and then you can sell the houseand then split ways without
having to dip into thatretirement or having to
refinance at six and a half 7%interest rate.
So I like doing that deep diveto lay out some of the options
(15:35):
that are there that some peoplemight not necessarily think
about and kind of put the mathbehind it, so that when you're
looking at the different optionsyou know the numbers.
Cary Jacobson (15:45):
Right, I would say that in our mediated cases
it's more and more often thecase where they are agreeing to
continue to co-own the house forthe next several years, with
the recognition that you knowthere is that low interest rate
and they want to protect theother spouse who's going to
(16:07):
remain there, you know, and theyrecognize that they're not
going to be able to afford it byrefinancing and that sort of
thing.
And so we're just getting alittle creative on what that
looks like and what the timingof that may be, and so far that
has been successful for most ofour clients.
But it, like you said, it worksin those amicable situations
(16:34):
and where you know, you know thespouse who is leaving doesn't
need that month, that cash, toto move on to purchase something
else, um, or, you know, towhatever their next step is
going to be.
Melissa Pavone (16:48):
Yeah, I think that's really important too.
You know, there's like that,given that, take like, hey, we
can co-own it, you can live here, and we can kind of be like a
tenant landlord situation wheremaybe you pay the mortgage but
if something big were to happen,right, that's a joint expense
that the owners of the housewould you know, then pay three
(17:08):
months and this is that.
You know all of that, thatlegal expertise that you bring
to the table, I think is reallyhelpful for kind of like those
clear boundaries.
So it's not an indefinite thingand the other spouse shares in,
(17:29):
like the risk reward of like,hey, the market could go up or
the market could go down, but weknow that there's like a
definitive timeline.
Cary Jacobson (17:38):
Absolutely so making sure that those
protections are in there so thatthey're both, you know,
protected if something happenslater.
So there is that timeline thatgives them some security.
And I always explain, you know,if you guys decide that
co-owning for a longer period oftime is something you want to
(18:00):
do, then you have the option todo that.
But this gives you someframework to use as far as, like
, putting the house on themarket and getting it sold.
Yeah, yeah.
I love that.
So do you as a CDFA, and everyyou know I've worked with lots
(18:21):
of different CDFAs and it kindof varies.
Do you do both neutral work,similar to a mediator, as well
as advocacy work, for likerepresenting or working with one
person?
Melissa Pavone (18:37):
Yeah, I do both.
It depends on you know whattype of you know divorce method
they're using.
I love playing in the neutralspace.
I'm a big proponent ofmediation and collaborative
divorce.
I love you know part of it.
Right, I'm I'm being efficientbecause I'm saving time and
money.
Instead of doing two differentfinancial discoveries, I'm doing
(18:59):
them both for both parties.
And there's a buy-in right,like let's just put everything
on the table and let's makesense of it together.
And I like to meet, even inwhen I'm a neutral, each party
separately and kind of say likehey, what's keeping you up at
night?
What are your fears, what areyour like must-haves?
And so I look at it as like afinancial puzzle piece that I'm
(19:22):
trying to solve.
Right, we have two streams ofincome.
We have you know X number ofkids.
We have one household, but howare we going to make this work
between one another with theassets that we have and the
liabilities we have, and andfinding that really balance?
Cause obviously we know nobodywins in divorce, right?
But we're trying to do this asefficiently as possible and as
(19:45):
cost-effectively as possible.
And I just love partnering withattorney mediators like
yourself that like to play inthat neutral space and that like
to be outside of court andsolve these problems without a
judge, having to make thesedecisions for the families.
Cary Jacobson (20:03):
Yeah, 100%.
That's what lights me up aswell, you know, in helping
people craft those resolutionsand finding that space that
works well for both of them, andgetting creative, because the
alternative of going to court isnot going to ultimately give
(20:23):
them the the peace that theythink that it's going to,
because of all that's involvedin that process absolutely well
before we wrap up.
For our listeners who want tolearn more and maybe explore
working with you, what's thebest way to reach out to you and
learn more about your services?
Melissa Pavone (20:45):
Absolutely.
My company's name is MindfulDivorce Partners.
Again, I work in person here inNew York.
We're virtually all over thecountry, said in a neutral
capacity, or if you feel thereis that imbalance and you just
need somebody kind of in yourcorner to help explain, I can be
your financial advocate throughthis process.
(21:05):
I can come in kind of beforewith the financial clarity
package as a limited scope totry to just see what it could
look like before you contactCary or another attorney,
mediator, before you get thatlegal support.
I can help you in the middle ofmediation.
Or I can help you after forthat post-divorce transition,
(21:27):
which is also a really importantpiece to make sure that, like
now that things are done, you'reon track to start saving for
your own retirement and makingsure your cashflow is in need
because of all the changes thathave you know happening due to
divorce.
Cary Jacobson (21:45):
It sounds like you kind of give a full scope of
different services for people,no matter what process they're
in and kind of where they are inany of those processes, so
that's wonderful.
Well, melissa, thank you somuch for your time today.
Your approach is so inspiringand reminds us that finance is
not just about numbers.
It's also about the actualperson themselves.
(22:07):
And to anyone who's listening,please reach out to Melissa.
If you could benefit from herservices and if today's episode
resonated with you, please thinkabout sharing this episode and
subscribing for next time.
I'm your host, Cary Jacobson.
Intro/Close (22:24):
Thanks for joining us today on this episode of
Divorce Diaries.
Remember, every journey isunique, but you don't have to
navigate it alone.
Visit jacobsonfamilylaw.
com or call 443-726-4912 forsupport and guidance.
Sometimes they get brought in in the middle of
a case and that could just belike they're seeing, you know, a
mediator like yourself,attorney, and they're like, hey,
you know, we're almost there,but we're stuck on this one
issue.
So sometimes the attorneys andthe mediators call me and say,
hey, like we're really good, wegot the parenting plan, you know
, but we're just, we're not surehow to deal with this family
(00:21):
owned business.
Or we're thinking aboutoffsetting the equity in the
house with a retirement account,but we want to take taxes into
consideration.
Can you help?
Intro/Close (00:32):
Welcome to Divorce Diaries, where attorney Cary
Jacobson brings you real stories, hard truths and practical
advice on navigating divorce andfamily law.
Whether you're going through it, considering it or just curious
, this is your place for clarity, confidence and resilience.
Cary Jacobson (00:54):
Welcome back to another episode of Divorce
Diaries Lessons from theTrenches, where we explore the
challenges and lessons that comewith divorce and highlight
professionals who are making adifference in the space.
I'm so excited to have MelissaMurphy Pavone, who is a CFP as
well as a CDFA and founder ofMindful Financial Partners, as
(01:17):
our guest today.
Melissa has spent over 18 yearsguiding clients through all
kinds of life transitions,everything from launching
businesses and changing careersto marriage, divorce and the
loss of a loved one.
She helps people get crystalclear about what they want out
of life and then build financialstrategies that support those
goals.
Melissa, welcome to the podcasttoday.
Melissa Pavone (01:43):
Thanks so much for having me, Cary.
Cary Jacobson (01:45):
Absolutely Well.
I'd love to just dive in, and Iwould love for you to start by
telling your story and talkingabout where mindful and mindful
financial partners comes from.
What does that mean in thecontext of financial planning
and how does it shape the waythat you work with clients?
Melissa Pavone (02:06):
and how does it shape the way that you work with
clients?
Absolutely so.
My career has been in many bigfinancial firms and they were
very much focused on yourbalance sheet and they weren't
as focused on the human in frontof us.
And I think that there was a bigdisconnect in the financial
world of being able to give truefinancial advice, because there
(02:28):
was an asset minimum right thatyou needed to get in order to
have that financial advisor andthat fee threshold and it just
wasn't in alignment with who Iwas and how I wanted to run my
practice, who I was and how Iwanted to run my practice, and I
think it's really important, nomatter how much money that you
(02:49):
have or investable assets, thatpeople really need true guidance
, and I really look at it from aholistic standpoint, and that's
where I want to work withpeople who really want to become
in alignment with what they'respending and where their money
is going, and I think it'sreally important, and so that's
where Mindful Financial Partnerscame from and from that became
Mindful Divorce Partners, whereI really help people go through
(03:13):
divorce but really educate themand empower them along the way,
because, as you know, divorce isnot just a legal issue or an
emotional, but it's also afinancial separation that you're
going through.
So taking that pause, reallydoing some inner work and
thinking to yourself like, hey,what does this mean to me now,
(03:34):
to my family and in the future,and how these decisions impact
your whole life right,absolutely so.
Cary Jacobson (03:42):
How do you work with a client who is going
through the divorce process anddo you have a team of
professionals that support themthrough that?
Melissa Pavone (03:54):
Absolutely yeah.
So Mindful Divorce Partners youknow people often ask me like
when's the best time to hire aCDFA?
And for those of you who don'tknow, cdfa is Certified Divorce
Financial Analyst, and so Ispecialize in the financial
aspect of divorce and sometimesthat's dividing assets and
sometimes that's planning for,you know, a change of income or
(04:19):
support payments and how weoffset some of these assets
right and how we divide a housein two or a retirement account
in two or a business in two,which, as you know, gets really
complicated.
So I, along with my team, gothrough and the mindful piece
really is the financialtransparency.
(04:41):
So it's very important to methat before people make any
financial decisions, they havethat financial transparency.
So we want to know what we haveright.
I always say you need to knowfive numbers before you get
started.
It's your assets, what you own,your liabilities, what you owe,
your income, what you earn,your expenses, what you spend
(05:04):
and your credit score.
And those numbers will reallyhelp guide you towards making
the best decisions for yourfinancial future as you go
through divorce.
And sometimes I can get yeah,sometimes I get brought in in
the very beginning of a case,right.
Sometimes I'm the first phonecall.
(05:26):
And sometimes I look at divorceas like a three-prong approach.
There's the emotional, thefinancial and the legal.
So sometimes if I'm the firstphone call, I often say like hey
, are you seeing a divorce coachor a mental health professional
?
Are you really ready to takethis next step, or are you just
kind of dipping your toe in thewater and then that will
(05:47):
determine if they're ready towork with me?
Or you know, here I have a listof recommendations for other
professionals that can helpsupport you until you're
emotionally ready to make thatnext, you know decision.
And sometimes they get broughtin in the middle of a case and
(06:16):
that could just be like they'reseeing you know a mediator, like
yourself, attorney, and they'relike, hey, you know, we're
almost there, but we're justwe're not sure how to deal with
this family owned business.
Or we're thinking aboutoffsetting the equity in the
house with a retirement account,but we want to take taxes into
consideration.
Can you help us?
And then the third part is kindof that post divorce.
(06:36):
Like, hey, I'm about to signthis paper, not really sure what
all this means.
Like, can you just do a onceover, right?
Just like you guys have reviewattorneys to kind of look it
over.
I offer like a one hour.
Just like, hey, what does thislook like?
Am I going to have divorceremorse?
Like, am I missing somethinghere?
Can you look it over?
So it really depends where youare in the process.
Cary Jacobson (06:57):
And where a.
Cdfa can help you the the onceover is an interesting concept.
Concept is it that before theyactually signed their settlement
agreement?
Melissa Pavone (07:12):
yeah.
Yeah, it's just as if you, likewe, were saying, hey, go get a
consulting attorney, like andsometimes it's hard right,
depending if you're the mediatoror the attorney, whether you're
, you know, an advocate orneutral to be like, hey, there
might be that power imbalancehere or a financial literacy
imbalance, and that's kind ofwhere I like to come in and say,
hey, you might not be the CFOof the family, right, you might
(07:36):
not have made all the bigdecisions.
Perhaps you were the one thatdid the day-to-day and, you know
, did the food shopping and allof like the kids' activities,
but not necessarily who theaccountant is where the
investments are where theinsurance is held, and so I
really like walk my clientsthrough that, understanding what
(07:58):
they have now andwhat they could have later after
that process.
So it's really important forpeople and sometimes, honestly,
they're intimidated, right?
There's some shame in coming tothe table and not knowing, and
I want to like get rid of thatshame, excuse me, and tell
people like it's okay, we'rehere right, like we're here,
(08:20):
we're going to move on.
You're going to always knowwhat your numbers are after this
, but let's align you withprofessionals that really want
to educate and empower you sothat you can make the best
decisions moving forward.
Cary Jacobson (08:32):
Absolutely, and this is something that I see
regularly, especially when I'mworking with couples in
mediation.
You know, I do a typical initialconsult and one of the things
that I'm trying to gauge is doboth people feel like they have
the information about thefinances and were both people
(08:55):
involved in being the CFO of thehousehold or at least
understanding what all of theassets are?
And when I find that there isthat knowledge imbalance about
the assets, then I really do mybest to make sure that they are
both, you know, have thattransparency, and one of the
things that I try to do is putit more on the onus on me so
(09:21):
that I can see what's kind ofgoing on.
And so we do like a sharedDropbox of all of the
documentation so that I canbetter kind of explain it.
And if I find that it's goingto be helpful for the couple to
reach a resolution, I willabsolutely recommend working
(09:41):
with a CDFA so that that personcan get knowledge, because I
don't find that you can reach aninformed decision on how these
assets are divided untileverybody's on the same page.
Melissa Pavone (09:55):
That's so good, they're so lucky to have you,
because not everybody, noteverybody does that and goes
through that extra step.
But I think and sometimes ittakes a little longer on the
front end but it makes for abetter settlement, right and a
long term solution, so that theydon't come back in a year and a
half and say, hey, this is notwhat I thought it was, this is
not going to work for us, likeyou know, and and then we'll
(10:19):
have to reopen their case again.
So I think, a little bit moreplanning and it's I call it like
the power of the pause, right.
Like, let's just pause.
Make'll say, oh, this is worth$100,000 and it could be a money
market account, and thenthere's equity in the house, and
(10:45):
then there's a 401k, and thenthere's a Roth IRA, and all of
those things can have a snapshottoday of $100,000.
But they're all not createdequal, right, we can't access
them the same and theconsequences aren't the same.
And so, therefore, I try toplay that what if game right,
like if we're going to trade Xfor Y, what does that really
(11:07):
mean?
And what's the pros, what's thecons, what's the tax
consequences for trading theseassets one for another?
Because when you're in it, it'sso hard to see past the day
you're not thinking about howthese decisions are going to
impact your future 5, 10, 20years down the line.
(11:28):
So I'd like to you know, as aCDFA, very empathetic.
This is a very hard time inyour life, but zoom out and look
at the long-term implicationsof these decisions and make sure
that you know.
You know the good, the bad andthe ugly.
Cary Jacobson (11:45):
Right, and I think the one that I see the
most often and gets to be one ofthe most complicated is one
spouse wanting to keep the houseand the other spouse using
retirement assets to kind ofoffset that, and so it is very
(12:06):
much a challenge in making surethat they both are aware of what
those consequences are.
Melissa Pavone (12:15):
Yeah, and again, that's one of the biggest
things I see too right, thehouse and oftentimes the house
is the largest asset between thecouples, right, and you can't
divide it in half, although I'msure people have tried,
especially where interest ratesare currently versus where we
all refinanced that a few yearsago, and it really, it really
(12:36):
changes the conversation of youknow, can we afford to get
divorced?
And a lot of people, I thinkthat's their fear and the fear
comes from the unknown right,because they don't know if they
can afford it.
They're thinking, hey, we havethis one house, two incomes.
We're barely making it.
Intro/Close (12:55):
How are we going to ?
Melissa Pavone (12:56):
do this on supporting two households and
that's really hard.
So I think that financialclarity piece is helpful and I
offer like a small limited scopepackage to go over that
financial clarity piece andwithin those three hours of
working together sometimespeople say, hey, you know what,
(13:16):
this isn't as bad as I thoughtit was right, I can do this.
I'm going to contact Cary andstart the process.
Or some people say, hey, youknow what, I need to save a
little bit more, or I need tospend a little less, or I need
to get my credit score up untilI'm able to make this work.
And so they do some work buteither way, they have that
(13:38):
education piece and kind of seewhat it could look like.
But oftentimes with the house Iget it right Because the house
is not the same and it's easy.
That retirement money you didn'tspend Christmas or the holidays
with that retirement account.
It's kind of numbers right on apage and letters and you don't
(14:00):
have that emotional attachmentto it, you don't have the
memories that are there, youdon't have the physical stuff
you know, and so I think that isa hard piece to you know, we
have to take that emotionalstandpoint in.
But I often caution people whenthey are saying, hey, I'm going
to forego alimony or I'm goingto trade retirement equalization
(14:25):
for the house.
Can you really afford to keepthis house?
Because you might be able toafford your mortgage today, and
just the mortgage.
But are we taking intoconsideration if the boiler goes
, if you need a new roof, like,are you going to have that
emergency fund on one income nowin order to be able to afford
(14:50):
these big ticket items thatbefore you had a two income
household to support?
So I always try to go throughthat what if?
Analysis to make sure it reallymakes sense.
And sometimes and I'm not sureif you've seen this before, but
like I like if you can co-ownthe house for a few years,
depending upon where your kidsare at and if you know it's an
(15:10):
amicable situation sometimesthat's the best bet because you
only have a few more years andyour kids are almost graduating,
and then you can sell the houseand then split ways without
having to dip into thatretirement or having to
refinance at six and a half 7%interest rate.
So I like doing that deep diveto lay out some of the options
(15:35):
that are there that some peoplemight not necessarily think
about and kind of put the mathbehind it, so that when you're
looking at the different optionsyou know the numbers.
Cary Jacobson (15:45):
Right, I would say that in our mediated cases
it's more and more often thecase where they are agreeing to
continue to co-own the house forthe next several years, with
the recognition that you knowthere is that low interest rate
and they want to protect theother spouse who's going to
(16:07):
remain there, you know, and theyrecognize that they're not
going to be able to afford it byrefinancing and that sort of
thing.
And so we're just getting alittle creative on what that
looks like and what the timingof that may be, and so far that
has been successful for most ofour clients.
But it, like you said, it worksin those amicable situations
(16:34):
and where you know, you know thespouse who is leaving doesn't
need that month, that cash, toto move on to purchase something
else, um, or, you know, towhatever their next step is
going to be.
Melissa Pavone (16:48):
Yeah, I think that's really important too.
You know, there's like that,given that, take like, hey, we
can co-own it, you can live here, and we can kind of be like a
tenant landlord situation wheremaybe you pay the mortgage but
if something big were to happen,right, that's a joint expense
that the owners of the housewould you know, then pay three
(17:08):
months and this is that.
You know all of that, thatlegal expertise that you bring
to the table, I think is reallyhelpful for kind of like those
clear boundaries.
So it's not an indefinite thingand the other spouse shares in,
(17:29):
like the risk reward of like,hey, the market could go up or
the market could go down, but weknow that there's like a
definitive timeline.
Cary Jacobson (17:38):
Absolutely so making sure that those
protections are in there so thatthey're both, you know,
protected if something happenslater.
So there is that timeline thatgives them some security.
And I always explain, you know,if you guys decide that
co-owning for a longer period oftime is something you want to
(18:00):
do, then you have the option todo that.
But this gives you someframework to use as far as, like
, putting the house on themarket and getting it sold.
Yeah, yeah.
I love that.
So do you as a CDFA, and everyyou know I've worked with lots
(18:21):
of different CDFAs and it kindof varies.
Do you do both neutral work,similar to a mediator, as well
as advocacy work, for likerepresenting or working with one
person?
Melissa Pavone (18:37):
Yeah, I do both.
It depends on you know whattype of you know divorce method
they're using.
I love playing in the neutralspace.
I'm a big proponent ofmediation and collaborative
divorce.
I love you know part of it.
Right, I'm I'm being efficientbecause I'm saving time and
money.
Instead of doing two differentfinancial discoveries, I'm doing
(18:59):
them both for both parties.
And there's a buy-in right,like let's just put everything
on the table and let's makesense of it together.
And I like to meet, even inwhen I'm a neutral, each party
separately and kind of say likehey, what's keeping you up at
night?
What are your fears, what areyour like must-haves?
And so I look at it as like afinancial puzzle piece that I'm
(19:22):
trying to solve.
Right, we have two streams ofincome.
We have you know X number ofkids.
We have one household, but howare we going to make this work
between one another with theassets that we have and the
liabilities we have, and andfinding that really balance?
Cause obviously we know nobodywins in divorce, right?
But we're trying to do this asefficiently as possible and as
(19:45):
cost-effectively as possible.
And I just love partnering withattorney mediators like
yourself that like to play inthat neutral space and that like
to be outside of court andsolve these problems without a
judge, having to make thesedecisions for the families.
Cary Jacobson (20:03):
Yeah, 100%.
That's what lights me up aswell, you know, in helping
people craft those resolutionsand finding that space that
works well for both of them, andgetting creative, because the
alternative of going to court isnot going to ultimately give
(20:23):
them the the peace that theythink that it's going to,
because of all that's involvedin that process absolutely well
before we wrap up.
For our listeners who want tolearn more and maybe explore
working with you, what's thebest way to reach out to you and
learn more about your services?
Melissa Pavone (20:45):
Absolutely.
My company's name is MindfulDivorce Partners.
Again, I work in person here inNew York.
We're virtually all over thecountry, said in a neutral
capacity, or if you feel thereis that imbalance and you just
need somebody kind of in yourcorner to help explain, I can be
your financial advocate throughthis process.
(21:05):
I can come in kind of beforewith the financial clarity
package as a limited scope totry to just see what it could
look like before you contactCary or another attorney,
mediator, before you get thatlegal support.
I can help you in the middle ofmediation.
Or I can help you after forthat post-divorce transition,
(21:27):
which is also a really importantpiece to make sure that, like
now that things are done, you'reon track to start saving for
your own retirement and makingsure your cashflow is in need
because of all the changes thathave you know happening due to
divorce.
Cary Jacobson (21:45):
It sounds like you kind of give a full scope of
different services for people,no matter what process they're
in and kind of where they are inany of those processes, so
that's wonderful.
Well, melissa, thank you somuch for your time today.
Your approach is so inspiringand reminds us that finance is
not just about numbers.
It's also about the actualperson themselves.
(22:07):
And to anyone who's listening,please reach out to Melissa.
If you could benefit from herservices and if today's episode
resonated with you, please thinkabout sharing this episode and
subscribing for next time.
I'm your host, Cary Jacobson.
Intro/Close (22:24):
Thanks for joining us today on this episode of
Divorce Diaries.
Remember, every journey isunique, but you don't have to
navigate it alone.
Visit jacobsonfamilylaw.
com or call 443-726-4912 forsupport and guidance.
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