12 Days of Giving Day 2: The $400K Divorce Mistake We Caught Just in Time

Divorce is already brutal. But when the money is handled wrong, it stops being “emotional pain” and turns into “your future just got cut in half.” In today’s 12 Days of Giving episode, Jamie Lima is back—and we walk through a real case where a woman was about to sign a settlement that would have effectively given away $300K–$400K she didn’t need to lose and forced her to sell the home she desperately wanted to keep for her and her special needs daughter. 

Jamie breaks down how this client—Mary—came to him at the tail end of her divorce. Attorney in place. Settlement basically done. Everyone “felt” like it was fair. But the numbers didn’t smell right. Once Jamie dug into the pension valuation, the 401(k), the house, and the way the QDRO was being handled, it became clear: the math was wrong, the tax advice was off, and she was about to pay the price for other people’s blind spots.

We get into the uncomfortable truth: most divorce attorneys are not money people. They’re experts in law, not in pensions, actuarial tables, tax rules, or QDROs. Yet millions of people just nod along and sign whatever’s in front of them—because they’re exhausted, emotional, and just want it to be over. That’s exactly how life-changing mistakes get locked in for the next 20–30 years.

You’ll hear how a simple 30-day “divorce clarity” review turned a $2,000 investment into a $400,000 problem avoided, allowed Mary to keep her house, protect her daughter’s future, and avoid an unnecessary tax hit that her original advice would have triggered. This isn’t theory. This is what it looks like when someone who actually understands the numbers steps into the process.

If you’re going through a divorce—or you know someone who is—this episode is your wake-up call. Get a second opinion. Stop letting emotions and fatigue make permanent financial decisions. And stop pretending your attorney is your financial planner.

👉 Watch the full episode on YouTube: [YOUTUBE LINK]

This is part of our 12 Days of Giving series running from December 12–23, where each day we drop a real conversation designed to protect your money, your mind, and your future—not just entertain you for 30 minutes.

As always we ask you to comment, DM, whatever it takes to have a conversation to help you take the next step in your journey, reach out on any platform!

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DISCLOSURE: Awards and rankings by third parties are not indicative of future performance or client investment success. Past performance does not guarantee future results. All investment strategies carry profit/loss potential and cannot eliminate investment risks. Information discussed may not reflect current positions/recommendations. While believed accurate, Black Mammoth does not guarantee information accuracy. This broadcast is not a solicitation for securities transactions or personalized investment advice. Tax/estate planning information is general - consult professionals for specific situations. Full disclosures at www.blackmammoth.com.

Episode Transcript

Stoy Hall, CFP® (00:10):
Happy holidays everyone.
And Jamie is back for another 12days of giving, and last year's
was really, really fun.
Also, one of actually the mostdownloaded episodes we had
within the 12 days last year.
He didn't know that, but I'mgonna lay it on him now with
that.
So without further do Jimmy,welcome back to 12 Days of
Giving.
Cannot wait for this year.

Jamie Lima, CDFA® (00:28):
I appreciate it, man.
I can't, it went by in a blinkof an eye.
We, I feel like we just recordedlast year's session and now here
we are.
Yep.
Here we

Stoy Hall, CFP® (00:36):
are.
So what do you

Jamie Lima, CDFA® (00:37):
got

Stoy Hall, CFP® (00:37):
for us this year?

Jamie Lima, CDFA® (00:39):
Well, uh, this year's is a little bit
different.
Um, I think it's a, it's itreally a, an opportunity to
share and pretty impactful storyon a case that we had, um,
recently this, this.
I say young gal, uh, she may notfeel like she's that young these
days, but um, she's, it was oneof our younger clients, uh, but

(01:02):
she, she had a pretty uniquesituation where she had a lot at
stake in her divorce and we.
Spent a little bit of time withher peeled back the union, so to
speak, and did a deep dive insome of the financial, uh, uh,
documents that she had.
And, and, and really just triedto spend some time with her
going through her case.

(01:22):
And, um, we were able to saveher lots in lots of money, which
was, I think is gonna really, inmany ways, change her life, man.
So, um, happy to share thedetails about it as much as we
possibly can to give yourlisteners something to, to, to.
Think about has, if they'reunfortunately going through the

(01:43):
divorce themselves.

Stoy Hall, CFP® (01:45):
Which we know statistically happens a lot,
right.
So it's not like something thatis, you know, you know, cut
outta the bag situation.
Divorce happens a lot in Americaand it's something that we have
to deal with.
So walk us through as much asyou can, kind of the background
mm-hmm.
Of, of getting into the divorceand reaching out to you.
I know we bring that up on everyepisode.
Mm-hmm.
But we know it's very importantto have a team, specifically

(02:05):
when you're going through adivorce.
Walk us through that a littlebit and walk us through what,
what you found out.
And then we'll get through likehow, not how much you saved per
se, but like what you did inorder to save her so much in the
divorce.

Jamie Lima, CDFA® (02:18):
And you're right, man.
I mean, like, you know, 50% ofthe people that we know and
love, uh, that are, are in a,you know, marriage situation are
likely, unfortunately gonna getdivorced.
And if they're in a same sex marsex marriage or if they're in a
second marriage, thosestatistics are a lot worse.
Um, so a lot of people out thereare going through this, but.
This lady, uh, her name is Mary.

(02:39):
I'm not making that one up.
Um, and no, her name is Maryand, and she, she came to us,
um, I forget how she found us.
It probably, I think she, Ithink she came through one of
our podcast episodes is how, howshe found out about us.
But the story, uh, the storygoes, she, um, was on the tail
end of her divorce, had hired anattorney.

(03:00):
To, to get her through thisprocess and wanted somebody to
come in and really just get usbe a second set of eyes on this
potential settlement that shewas willing, you know, planning
on agreeing to when, before we,we got involved.
And in her particular case, the,there's a, the, uh, another
challenge that she faced is shehas a special needs daughter who

(03:24):
she is full-time caregiving for.
So that adds in a whole otherlayer of complexity, especially
around things like taxes andchild support and, and ongoing
support.
Uh, so, so we, we, we sat withher and basically just, you
know, try to get anunderstanding of, you know,
where is she at right now andwhat is the framework for the
agreement.

(03:45):
And in this particular case,there's a pension involved.
There's a 401k plan involved,and there's some other assets,
one being, one being the house.
And she really wanted to keepthe house, but the, because of
the amount of money she was, inthis particular case, she's the
breadwinner.
And in this particular case, shewas going to have to give up
basically half of the assets tothe, to the husband.

(04:07):
And he wasn't really playingalong as far as caregiving for
the daughter.
And, and so there was thatdynamic involved, but there was
also the, the complexity of.
I, I might have to sell my homein, but I, I really wanna stay
in it, but I ha I, I, I thinkI'm gonna have to sell my house
simply because I don't know if Ican afford to pay him, you know,

(04:29):
care for my daughter, and thenalso give myself the future life
that I am I'm aiming for.
So, you know, we, and we hearthis a lot, right?
We, we, we deal with these casesall the time, and there.
Every situation's different.
But you know how it, you knowhow it is, even in the
traditional financial planningroles that we play, you see the

(04:49):
same movie over and over again.
It might be different actors andmaybe, you know, some different
aspects that are different.
But, you know, it's, it tends tobe the same movie.
And this was, we've, we've seenthis one before.
Well, she came to us and we, wehave what's called a divorce
clarity package.
And in the divorce Claritypackage, people come to us and
for, for a reduced rate, theywork with us for on a 30 day

(05:12):
window.
So they basically say, okay,like, send us all your stuff.
We're gonna review what you haveand we'll help you for the next
30 days.
And these are, these are greatengagements because not
everybody needs us to work withthem for a year or two while
they're going through theirdivorce.
Sometimes they just need yourhelp in like point in time,
which is what Mary needed helpwith.
So we looked at the pension,which was the, the pension.

(05:37):
People think that pensions aresimply a calculation of how much
money's coming in every month,and how long do I think I'm
gonna live and multiplying thosenumbers together to come up with
a, a, a, a value.
Well, there's a lot more that'sinvolved.
There's things like the interestrate environment, the discount
rate, the um, actuarial tables,length of employment, length of
the marriage.

(05:57):
There's a whole.
The whole calculation we run to,to be able to give an actual,
put an actual value on thatpension.
So we did that.
Then we looked at the 401k planand we said, okay, well, like
how is this?
How is this allocated?
That was pretty straightforward.
And then we looked at heroptions with the house and.

(06:19):
When you looked at the agreementthat she gave us, ultimately
what it came down to was she wasgoing to give up half of all the
assets and she was, she wasgonna sell the house.
That was what the agreement wasbecause based on, um, her
situation that the attorneyfigured, Hey, this is probably
the easiest way to cut thisthing in half and just move on.
And the other wrinkle on thiswas.

(06:43):
They were, the, the way that theattorney was explaining how to
do the Quadra, which is dividingup the retirement accounts, was
also inaccurate.
So we, we go through this wholething and, and we're looking at
it and we're like, somethingdoesn't add up on the, the
pension.
So we're, look, we, we, we doveinto it and ran the calculations
and sure enough, the numbersthat they were putting behind

(07:05):
the pen, the value of thatpension were completely
inaccurate.
So not only does this, is thislady putting all of her faith
into this attorney to get herthrough this, the, the, the
divorce, but she's also puttingher faith in the mathematics
behind the pension.
She's putting her faith in thefollowing the, the
recommendations relative to thequadro and what to do with the

(07:29):
house.
And when we, when we actuallyspent some time with it and
really dug into it.
The difference between what wehad as far as the value of the
pension and what the attorneywas giving was somewhere in the
neighborhood of three or$400,000.

Stoy Hall, CFP® (07:45):
Oh,

Jamie Lima, CDFA® (07:49):
changes things because now she doesn't
have to give up$400,000 over401k.
It's now down to like 140,000.
Now she has more money in herback pocket where she can
support her daughter.
And keep the house.
So you know, this$2,000investment she made with us came

(08:12):
out to be like a$400,000 win andshe gets to keep the home that
she wants to keep.
So, you know, I felt good aboutthis one man.
I felt good about this one and Ifelt bad for the attorney'cause
she had to go back to theattorney.
And I'm not really sure howthose conversations went'cause I
wasn't privy to them, but I canimagine they didn't go too well.
But sometimes it's just about.

(08:33):
Understanding, you know, likehow all this stuff works and,
and the other, with the quadro,I, I forget exactly what the de
but what the, the, the attorneywas basically telling her, just
taking distribution out of the401k plan to do.
And it was, instead of doing thequadro and dividing things up
and not paying the taxes onthose distributions.
They, I, I forget exactly'causeit's been a little while what

(08:55):
the, what the details are of thequadro.
But I do remember that there wasbad advice and it was related to
the taxes.
So we saved her on the tax fronttoo.

Stoy Hall, CFP® (09:03):
That's massive.

Jamie Lima, CDFA® (09:05):
Yeah,

Stoy Hall, CFP® (09:05):
it's a big one.

Jamie Lima, CDFA® (09:06):
Yeah.

Stoy Hall, CFP® (09:07):
Um, how did she feel at the end of it, right?
I mean, there's a lot ofemotions there.
One, she gets to keep the housedaughter in the house, take care
of her daughter.
That is a, is a high, um, butyou have the opposite of that
emotion too, of Well, I've nowmaybe she feels wronged or, and
not getting the right stuff fromthe attorney.
How, how did her emotions gothrough this?

Jamie Lima, CDFA® (09:29):
Well, I remember when we, when I first
met her, you know, how.
How nervous she was, you know?
And, and it's, it's okay forpeople that are working with
financial planners, especiallyif you're going through a
divorce, to have some of thatanxiety because you don't know,
really know what kind offeedback you're gonna get.
You don't know if you have, um,you know, if you have a good

(09:52):
argument or what yoursettlement's gonna look like.
There's always questions thatyou have, which create creates
that anxiety.
And, and I could tell she had alot of it.
I, when I was able to deliverthat news to her and we, we
draft the whole recommendationand we'll put it all in, in, in,
in, uh, documented form for her,and I was able to actually
deliver that to her.

(10:12):
Um, you could see the weight waslifted, for sure, for sure.
That was, this was a, this was ahuge win for us.
Um, and now it's, you know, she,she's able to do a lot of the
things she didn't think she wasgonna be able to do.
You know, and, and for the next,for the next chapter of her
life.
So

Stoy Hall, CFP® (10:32):
that's an amazing story and, and I think
there's a few parts that Ibrought out, like the, what I
figured out from it is one, justwhen you're going through the
situation, no matter where youare in the process, unless
you've already signed,obviously, is just a 30 day
review.
Just a little snippet of havingsomeone else come in, one could
save you, but also it might justgive you that other opinion to

(10:56):
stick to your case or to let youknow what's real, what's not.
The other is, and we've talkedabout this on, I think every
episode we've been together isattorneys are great at what they
do in their lane when it becomesto the money that's not their
lane and it really should neverbe their lane.
Right?
That's what we do.
That's what we're here for.
And I thought you catching thequadro, that's, that's massive.

(11:18):
And that one probably is one ofthe bigger ones in almost every
divorce is some type of Quadrosituation.
For people to understand thatlike, yeah, you taking a
withdrawal and then splittingit.
Massive taxes, the quadro isthere for his exact reason of
being able to divide your assetswithout the taxable event.
So those were the points that Ireally felt from this story that

(11:40):
are, are one massive in whatthey do in terms of return of
working with someone like youor, and or the fact of like, you
just kind of need to know thesethings so you don't feel like
you get, you know, cheap skatedor any of those things.

Jamie Lima, CDFA® (11:54):
Yeah, and, and like you said, you know,
the, the attorneys just don'tunderstand this stuff, the
financial aspects of things and,and how it all works.
And to give bad advice on takingdistributions out of her
retirement account, you know,but instead of, you know, forgo
or forgoing to the Quadro, or I,again, I forget exactly what the
details were, but I remember I,when, whenever she told me that,
I was like, I don't think that'show this works.
And this, um, it wasn't, itwasn't too hard to uncover that

(12:18):
mistake, but, um, yeah, man,it's.
This again, this was, this waslife changing for her and I'm
glad to have been a part of it.

Stoy Hall, CFP® (12:27):
Absolutely.
So everyone listening whileyou're sitting around, I'm sure
you know someone who's goingthrough a divorce, maybe going
through a divorce.
You are going through a divorce.
Simplest thing is reach out.
Whether it's to Jamie, myself,someone, obviously we want it
inside of our own collective,selfishly, right?
Mm-hmm.
Uh, but hey, of course you'rehere as a resource because it is
so important to get that set ofeyes to see things that you

(12:50):
don't know, especially if you'reonly working with an attorney.
They don't see things either.
And the experience that Jamieand his team have is, is bar
none.
So while you're sitting aroundmaybe listening to this or even
getting a glimpse of this, makesure to reach out so we can
help.
And I know there's a lot ofpeople going through this, and
just to have someone in yourcorner a little bit through this

(13:10):
emotional time period will paydividends regardless if we catch
an issue like you just heard onthis story today.

Jamie Lima, CDFA® (13:17):
And think about it from the, if you look
at it from a, a medicalperspective, right?
If you had something major thatyou were dealing with from a
medical perspective, you wouldget a second opinion and
probably even a third opinion.
When you're making decisions indivorce, these decisions are
gonna impact you for the next 20or 30 years of your life.
These are incredibly impactfuldecisions that you're making,

(13:39):
and sometimes you're makingunder what you feel like is a
little bit of emotional duress.
Why wouldn't you just take abeat and and get a second set of
eyes on things?
Is it just, it just makes sense?

Stoy Hall, CFP® (13:49):
It does it, it truly does.
Jamie, appreciate you Have ahappy holidays, everyone
listening.
Also, happy holidays.

Jamie Lima, CDFA® (13:55):
Appreciate you.