February 6, 2024 • 38 mins
Discover how to navigate the complexities of divorce with financial savvy and emotional intelligence as we chat with financial divorce consultant Mark Hill, CFP, CDFA, therapist Pete Roussos, MFT, and attorney Shawn Weber. This revealing conversation is packed with expert advice on the crucial role of financial specialists during divorce mediation. You'll gain an understanding of the emotional weight of assets, how to balance power dynamics, and the subtleties of informed decision-making. Our guests strip back the layers of financial negotiations, providing a clear path to a fair settlement that respects both the past and future financial health of those involved.
We also dissect the utility and foresight offered by prenuptial agreements, and why financial planning should be an essential part of marital discussions, with or without the prospect of separation. Mark, Pete, and Shawn debunk the common myths surrounding the involvement of financial experts, emphasizing their potential to simplify and streamline the process, despite initial concerns about cost and complexity. If you're facing the challenges of uncoupling, or simply want to fortify your marital financial planning, this episode is an invaluable guide to protecting your assets and peace of mind.
The Three Wisemen of Divorce are divorce experts Mark C. Hill, CFP®, CDFA®, Financial Divorce Consultant; Peter Roussos, MA, MFT, CST, psychotherapist; and Shawn Weber, CLS-F*, Family Law Mediator and Divorce Attorney.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Pete Roussos, MFT (00:01):
Well, just one suggestion, and this is not
an area of expertise for me, butI think Sean and I so respect
and appreciate the way youtechnically manage these
podcasts.
One suggestion I have is, ifyou're doing search engine
optimization for this episode,you don't use the words anal
probe.
Shawn Weber, CLS-F (00:24):
Welcome to the Three Wisemen of Divorce
Money, psych and Law podcast.
Sit down with the Californiadivorce experts financial
divorce consultant Mark Hill,marriage and family therapist
Pete Rousos and attorney SeanWeber for a frank and casual
conversation about divorce,separation, co-parenting and the
(00:44):
difficult decisions real peoplelike you face during these
tough times.
We know that if you are lookingat divorce or separation, it
can be scary and overwhelming.
With combined experience ofover 60 years of divorce and
conflict management, we are herefor you and look forward to
helping by sharing our uniqueideas, thoughts and perspectives
on divorce, separation andco-parenting.
(01:07):
Okay so, mark, you and I weretalking offline about a movie
with Jack Nicholson and KathleenTurner.
What was it called?
Again, prixie's Honor.
Mark Hill, CFP, CDFA (01:20):
I always quote it when it comes to how
important is money in divorce.
The story of the movie is thatKathleen Turner and Jack
Nicholson are both hit men orhit people for rival mob
organizations.
Somewhere during thetransactions a million dollars
(01:42):
which was a lot of money back inthe 18s, probably when this
movie was made has gone missingin a briefcase.
At one point Jack Nicholsonsays to Kathleen Turner no, no,
no, you don't understand.
The Prixies really love theirmoney.
They love their money more thantheir children and they really
(02:02):
love their children.
That's how money is in divorceis that people love their
children, but they also lovetheir money.
It's a really important pieceof the pie.
The question becomes how do youhandle that?
What's the most appropriate wayto do it?
Many clients say well, I've gota CPA and I've got a financial
(02:24):
advisor, they can do that for us.
My response to that is theydon't have the training.
Since I was a financial advisorand had my own wealth
management firm for many, manyyears, I know what that role is.
I know it's very different thanthe role that a financial
neutral takes in a divorce case.
(02:44):
The education is different andthe knowledge required is
totally different.
I would say that in most cases,since this is probably going to
be the largest financialtransaction of a client's
lifetime, it would be prudent tohave somebody who's really
experienced in doing this work,especially if you're going to
(03:07):
mediate it and you are trying tostay out of rival experts in
every field.
Shawn Weber, CLS-F (03:16):
Last time we talked about why it's important
to have an attorney as part ofyour mediation, which naturally
makes plenty of sense.
I think attorneys areabsolutely essential.
I speak as an attorney youwouldn't, wouldn't you?
But I think this part, too, isabout why it's important to have
(03:41):
a financial specialist as partof your divorce mediation.
I think for a lot of cases,it's every bit as important as
the attorney having thefinancial specialist involved in
your case, because there arethings that you might not think
about if you didn't have theright professional on the case.
Mark Hill, CFP, CDFA (04:03):
Yeah, and very often there's an imbalance
of power because of thisimbalance of knowledge around
the money.
Shawn Weber, CLS-F (04:10):
Right, you said that before you have the
moneyed spouse and thenon-moneyed spouse.
Sometimes I'll call thefinancially curious spouse
versus the not so curious.
Mark Hill, CFP, CDFA (04:20):
Yeah, and the reality is that, in order to
be a participant in thisprocess, the concept of informed
consent comes up, which meansthat you could agree to anything
in a mediation process, as longas you understand what you're
doing and what might happenunder other circumstances.
Shawn Weber, CLS-F (04:40):
I've even had people are like well, I
don't care about the money, Ijust care about the children.
And then you start talkingabout the children and meeting
their needs and then you realizethat actually they have to care
about the money because we'vegot to figure out how to make
sure the kids are supported.
Mark Hill, CFP, CDFA (04:56):
So my role is essentially to first of all
quantify the marital estate andthe assets and debts that both
people have and the income andexpenses that they are going to
be dealing with.
Once we've quantified it, we dothe court forms.
Sean, most lawyers don't go tolaw school because they love
(05:19):
arithmetic.
I certainly did not.
They tend to like words andconcepts is what drives people
to law school.
What we can do is usually morecheaply and candidly, more
accurately the most attorneys iscreate the necessary what are
called disclosure forms thathave to occur at least once in
(05:42):
the divorce.
So we quantify the estate, wedo those forms and then we
evaluate it, we take a look atit and we go.
What's going to be challenginghere?
Has there been commingling ofassets that were in existence
before marriage?
Has there been a long timesince the data separation with
the courts?
Long time since the dataseparation with contributions,
(06:03):
say, for example, going toretirement accounts, those kinds
of things that we are aware of,that clients perhaps would not
think of as important issues,but they can be worth hundreds
of thousands of dollars.
And then we educate whennecessary.
Back to what I was sayingbefore about making sure both
(06:23):
parties can be participants atthe table so that they can have
that informed consent, so whenthey make an agreement they know
what they're doing.
And also, sean, you and I areoften at the table together
facilitating this process.
So I think, if that is, thefour step stage is quantify,
evaluate, educate and facilitate.
Pete Roussos, MFT (06:48):
You know, I certainly.
My sense is that most whenpeople go into a divorce process
, the professionals that they'remost likely to encounter first
as an attorney.
So, sean, how do you say more,if you would, about how you talk
to people about why it reallyis in their best interest to
(07:09):
have additional professionals towork with, to bring in a
financial specialist, and how doyou talk with them about the
concerns that they have aboutthe cost of a process and
bringing additionalprofessionals in?
Shawn Weber, CLS-F (07:24):
Well, I mean , the first thing is number one.
I kind of do a little minievaluation of my own.
If it's something I feelcomfortable dealing with, I'll
deal with it.
You know, and that's a very lowbar, it's a very low threshold.
You know, some cases really arethat simple.
They just have a house and theyhave a couple of bank accounts
(07:45):
and maybe an IRA.
You know, some cases are likethat, they're that simple.
But there is a level ofcomplexity where it becomes very
clear to me that a financialspecialist is essential, not
just it would be nice, but itwould be essential.
Pete Roussos, MFT (08:00):
Mark is well to you both.
So what is that?
I'm thinking of people that arethinking about divorce.
Can you describe what thatthreshold is, the specifics of
it?
What are the things?
If you will, the red flags, ifyou will that suggest to you,
they really need to bring afinancial specialist in.
Shawn Weber, CLS-F (08:23):
For me.
I look at, you know, the networth.
I also look at just thecomplexity of the assets.
If they have multipleretirement accounts, not just
one or two, if they havedeferred compensation, if they
have RSUs or stock options.
If there's a business, you knowall of these things can kind of
(08:50):
work together.
I mean, do they have multiplestock accounts and multiple
positions?
You know, then it quickly getsbeyond what I should be helping
people with.
And if it requires expertise toreally understand it, then you
should hire the right expert forit.
(09:11):
And I always tell my clientswhen they complain about the
cost level.
You know it's the three R's.
You want to get the rightperson to do the right work for
the right price.
So you don't want to pay myattorney rate to analyze
someone's stock options.
That would be foolish, you know.
And the other piece is whenthere's some disparity in
(09:35):
knowledge.
That's a really big red flagfor me where I'll want someone,
like a mark, to come in and helpkind of level the playing field
between the moneyed spouse andthe non-moneyed spouse.
And oftentimes you'll have themoneyed spouse say well, I
understand all of this stuff, Ihandle this, you know, I'm a
financial advisor myself.
I don't need to hire acertified divorce financial
(09:57):
analyst to do this, so I couldjust do it myself, and Mark
taught me this years ago.
And you say to the person well,you're at a real disadvantage,
aren't you?
What do you mean?
Well, your spouse wouldn't knowa good deal if it bit her in
the leg, bit him in the leg,because they just there's no way
they can know, and usually youknow you'd think that would
(10:17):
offend the other person.
They're nodding their heads,that's right, I wouldn't know.
Mark Hill, CFP, CDFA (10:21):
And often the person that is the moneyed
spouse will say offline yeah,I've been trying to get him or
her engaged for the last 20years and that hasn't worked.
So they will often admit thatand there's nothing unhealthy
about that.
There's nothing unhealthy about, you know, when you have a
(10:43):
marriage, of the division oflabor I mean it's kind of one of
the benefits of being married,frankly but nobody signs a
contract.
When they get back from thehoneymoon says you're going to
do the yard and I'm going to dothe cooking and I'll take care
of the kids and you earn themoney.
But that's how things evolveover time and so that creates
that imbalance of power that Ialluded to earlier that we
(11:05):
really need to try to dissipate.
Before you get into substantiveconversations and start, you
know deciding what goes whereand who gets what.
Shawn Weber, CLS-F (11:18):
Yeah, yeah, I think that's a big piece of it
, and just letting people knowthat this isn't wasting money,
this is saving you money in thelong run.
Yeah, because you know,especially when you're talking
about larger amounts of money,if you know a little swing in
(11:39):
your analysis of just a fewpercentage points could be big
money, yeah, and so why take thechance?
Go ahead and hire somebody thatcan be on your team, who can
help you with that analysis.
Mark Hill, CFP, CDFA (11:55):
And the other thing I'll say is that
when a marriage breaks down, Ithink it's almost universal that
there's been a breakdown intrust at some point, and so you
may have somebody who's veryknowledgeable, who's ready to
come in with their spreadsheetsand their analysis, and it may
(12:15):
be totally kosher and it mightbe correct in every regard.
However, is the other persongoing to believe it?
If there has been a breakdownof trust on other issues?
I've seen cases where there'sbeen impidelity and the response
is well, if he, she, lied aboutthat, they must have lied about
everything else.
So I can't trust them.
So having a third party to sayyou know what, it is okay and I
(12:39):
can tell you that it's okay,often gives comfort and allows
the process to move forward.
Pete Roussos, MFT (12:45):
You know I'm thinking of Mark in terms of
what you're just describing.
You know you're talking aboutgood faith, dynamics and
something that we've touched onbefore in the context of
mediation or in terms ofcollaborative process.
It really is basedfoundationally on an expectation
of good faith, on anexpectation of transparency, and
(13:10):
I think that would be just auseful thing for us to really
reiterate the absoluteimportance of that to these
processes that we're talkingabout.
Mark Hill, CFP, CDFA (13:18):
I couldn't agree more.
And the flip side of that is itonly takes one violation of
that in order to destroy theprocess.
You know, and I've seen thathappen.
It's rare but you know, withsome it's what I used to call
the smartest guy in the room,and sometimes it's the smartest
(13:40):
gal in the room.
But there are people who comeinto the process thinking
they're going to be smarter thanall of the professionals in
there and it's my job, from afinancial standpoint, to disavow
them of that concept veryquickly, because if someone's
coming in thinking they canmanipulate the process, I want
to terminate that processquickly.
(14:00):
Or you know, I'll have a cometo Jesus meeting and says hey,
you're at risk of that if youdon't.
You know, if you do this againsort of thing and sometimes it's
not just somebody providingwrong information Somebody's
dragging their feet can have thesame impact and I'm failing to
provide things and dragging itout.
(14:21):
Eventually the other spousegoes to hell with this.
I need some teeth and thereforeI'm going to litigate this and
then you're off to the races andwe're act.
Pete Roussos, MFT (14:30):
Mm, hmm, mm hmm.
Shawn Weber, CLS-F (14:33):
Well, one of the things I also like about
with having a financialspecialist is those cases where
the parties just don't seem tohave time to do their
disclosures.
You know, and it's been monthsand months and months, I can't
get them to move forward ondoing the mandatory disclosures.
You know, at least inCalifornia, there's the income
expense declaration that'smandatory and a schedule of
(14:54):
assets and debts.
They have to provide two yearsof tax returns, statements of
material facts and informationand exchange that and that
usually in a mediation, ends upbeing the most annoying part of
the process.
Mark Hill, CFP, CDFA (15:08):
Everybody hates filling out forms.
Shawn Weber, CLS-F (15:11):
Me included right.
Mark Hill, CFP, CDFA (15:12):
Yeah, I get it, but if you don't do it,
you know this is one of mybiggest frustrations is I have
two clients, right, I have ahusband and a wife, okay, and
both of those clients have to doa certain amount of work.
One of them is very diligent,gets it all done.
(15:34):
The other one doesn't.
They're busy, they're traveling, they've got stuff going on
with the family, whateverThey've got their excuses, and
the months go by and eventuallythey provide us with everything.
However, all the dates on thestatements from the other stuff
are now aged out.
It has to be what 60, 90 daysyou know it's supposed to be on
(15:57):
those forms the statements mustbe within.
So if someone doesn't respond,that can be very disruptive
because A I've got to chargeagain to update all the numbers
Not a huge amount, but it'sgoing to have a cost.
There's also a time, and thenthe person that did it in an
appropriate and timely fashionis now being penalized and
(16:22):
having to do it again, whichagain can be very disruptive to
the process and can really sendit off the rails.
So you need a financial advisor,folks, if you have.
Now, the only cases really arethe ones that are simple, like
Sean indicated before, wherethey don't have much on the way
(16:44):
of assets.
I'll say something elseShort-term marriages too, very
short-term marriages, perhaps,if we're not necessary, and what
I call the college divorce,where you get the dog and I'll
take the books and have a nicelife, that kind of stuff that I
think is a rarity coming to us,because a lot of those people
(17:07):
just go pro, pro and they justtake care of themselves and we
don't even see them.
Pete Roussos, MFT (17:11):
Well, what is it, Mark, about short-term
marriage?
Mark Hill, CFP, CDFA (17:15):
Well, in a short-term marriage, if it's
short enough.
I don't want to step on yourshoes, sean, but support is not
an issue.
If it's very, very short-term.
Also, they haven't had perhapsthe time to accumulate assets
during the marriage that need tobe distributed.
You've got a couple of years ofmarriage.
Well, do they care that they'veboth been contributing to 401Ks
(17:39):
?
Probably not, unless there's ahuge disparity, if there's not a
huge disparity in income.
Those are very simple cases.
But the longer a marriage goes,the more complex it becomes and
the more challenging it becomes,because so many times we have
cases where one or both of theparties own real property before
(18:00):
the marriage.
The houses were sold during themarriage and then they bought a
house together.
So we need to do what's calleda more Marsden tracing.
That says how much of theoriginal funds that went into
the purchase of that propertyduring marriage came from each
one of them and how do they getcredit for that.
(18:22):
The longer and then the longera marriage is where there are
retirement accounts that werebrought in, then they continue
to contribute to during themarriage for 20 years.
How do we work out?
What was the premarital shareof that and do they care?
But if you can't quantify it,you can't decide if you care or
not.
I always almost to the point ofbeing annoying in these cases,
(18:48):
I want a number.
Once we've got a number, thenwe can talk about it.
But often in these cases it'swell, I deserve this and I
should get that and so and so.
Well, what does that mean?
What does this mean?
Why put a number on it and thenwe can talk about it and decide
if the other side cares.
Shawn Weber, CLS-F (19:10):
I was thinking about the objections I
received from clients about oh,I don't want to pay for a Mark
Hill, I don't want to pay for afinancial specialist, I don't
want to do this.
I think that one of theobjections would be added cost.
They think it costs too much.
The other would be that theythink it makes it too complex.
And the third is they'refearful that when they think of
(19:32):
a financial person, they thinkof forensics and they think
they're going to be undergoingan anal probe.
Now, and I can assure you Markdoes not want to do an anal
probe.
Mark Hill, CFP, CDFA (19:41):
I do not.
And also my background is as afinancial planner.
A financial planner's focus ismore on the future.
I mean, we've got to know whereyou stand today.
But we're not accountantsforensic accountants always
looking backwards, we're lookingforwards.
Now we can do pretty goodtracing in my office, but there
(20:03):
have been a couple of occasionsduring my career where I've
actually suggested we hire aforensic accountant to go do the
tracing because candidly, Iadmitted it was beyond my pay
grade.
Shawn Weber, CLS-F (20:14):
Yeah, I mean , if you need a business
appraisal, you have to hiresomebody to do specialty work
there.
But as far as cost is concerned,it goes back to that.
It's kind of economies of scale.
You're paying the right personto do the right work, so
actually in my opinion itreduces the fees and gives you a
(20:37):
better product.
Then, when you're talking aboutcomplexity, it does not
increase the complexity, itactually simplifies.
Yeah, If you have complexityalready a good financial
specialist can take challengingsubjects and can reduce it to a
form that's digestible so thatyou can then make decisions Then
(21:01):
it's not overly intrusive.
What would be overly intrusiveis if you went to court and then
we hired forensic accountantsand then there were depositions
and people were subpoenaing youremployer.
Mark Hill, CFP, CDFA (21:15):
That is intrusive and you have two
attorneys doing all thesenumbers and then spending months
and thousands of dollarsarguing over what the pie is.
Shawn Weber, CLS-F (21:24):
But if we could keep it within the
mediation context.
The financial specialist fallsunder the mediation
confidentiality, which meansit's more private, it's more
mutual, the information is thereand people can make decisions.
Pete Roussos, MFT (21:47):
We're talking about the role of the financial
specialist in a divorce process, a divorce mediation.
I'm curious, Mark, do you alsoget involved?
Is there a role that you havefor couples that are looking to
marry and are wanting to puttogether a prenup?
Was there a discussion you getinvolved in?
Mark Hill, CFP, CDFA (22:09):
Yes, it's fairly rare People quite
honestly, they probably have hada divorce before to consider it
.
Because people go in withrose-coloured glasses, shall we
say, to most relationships anddon't think about it until
things turn sour.
But if you've been throughdivorce or you've had a family
(22:31):
member or your parents wentthrough it, people are much more
.
Or if there's a huge disparityin the wealth, where you have an
extremely wealthy personmarrying somebody who has less
funds, that's not uncommon tohave that done.
I've had people say, oh, I don'twant to do that, it would break
(22:52):
the romance.
Well, yeah, but wouldn't yourather have the conversation
when you're getting along thanwhen you're wanting to get
vengeance against each other orthey're perceived crimes during
the marriage?
I would say, yes, but it's ararity.
(23:13):
But when it comes through thedoor, I can certainly help on it
because first of all, I canhelp explain the rules, how this
works, and I'm commingling whenyou put your funds in with
somebody else's funds, somebodyelse being your spouse, does
that change the character ofyour property?
There's rules around that andyou need to understand them in
(23:36):
order to not have surprises downthe road.
I've had many people say, oh,if only I'd known I wouldn't
have done that.
Shawn Weber, CLS-F (23:46):
To be clear, the level of disclosure that's
required for a prenuptialagreement is the same as what's
required for a divorce.
So there's a lot of work thatneeds to be done.
If you don't disclose them, ifyou get something wrong and
somebody relies on that, thenthe prenuptial agreement could
be worthless.
So having a financial personhelp you put the disclosures
(24:07):
together is a really good pieceof insurance.
Mark Hill, CFP, CDFA (24:10):
And then also.
Shawn Weber, CLS-F (24:11):
I'm sorry, mark, go ahead.
Mark Hill, CFP, CDFA (24:12):
What I was going to say.
It sets the relationship off onthe right footing.
People go into marriages, intorelationships, with assumptions
we seldom discuss with the otherperson.
Oh really, you expect me towork after we get married?
Oh, I didn't know that, or what.
(24:34):
You're going to retire in threeyears.
You didn't tell me that, thosekind of things.
It's helpful to have thoseconversations before, as I say,
when you're getting along.
Shawn Weber, CLS-F (24:49):
Well, and I always tell people you have a
prenup already written, whetheror not you actually sign one.
Yeah, if you don't make yourown prenup, then you have a
prenup that was written inSacramento by the legislature,
you know, or whatever stateyou're in.
Yeah, but you know, thinkingabout these things beforehand,
and I think the thing thathappens that maybe you've seen
(25:09):
this mark is Is when people arethinking about getting married,
all they're thinking about ispicking out China and where am I
registered and what's thewedding gonna be like, and they
don't want to have to thinkabout these things.
Yes, yeah, but they reallyshould.
And and take the time to do itright.
Don't just do a half-buttedDisclosure.
Make sure it's a complete andthorough disclosure.
(25:30):
You want to make sure thatyou're gonna spend the money and
time on a prenuptial agreement,that it's something that'll be
useful to you enforceable yeahand enforceable.
Mark Hill, CFP, CDFA (25:38):
Yeah, I mean and and and, and you know
you and I have had theseconversations many times about
prenups.
You know we've seen good, thegood, the bad and the
indifferent, haven't we man?
We've seen ones that, you know,because of change of
circumstances, may not be valid.
You know, we've seen ones whereone of the parties, over a
(26:00):
20-year marriage, just doesincredibly well, has a huge
amount of money, and the otherone Didn't do so well, you know,
because of inheritance orbecause of some separate
business interest or somethinglike that.
And now there's a realimbalance there.
And what's the term?
(26:20):
The difference between the, theincome or the?
Well, yeah, Unconscionable.
Shawn Weber, CLS-F (26:28):
So it's so in California and it may be
different in different states,but in California the
Conscionability of a spousalsupport waiver, hmm, it is
determined at the time ofenforcement, not at the time of
signature.
So what I mean by a contract, adefense to a contract, is a
contract will not be informed ifit's determined to be
(26:50):
unconscionable.
I mean it's so awful that itshocks the senses.
And We've had cases and in factI got one now where when they
got married they had similarincomes Maybe they had nothing
and then during the marriage oneof them developed a career and
the other one Became astay-at-home parent or something
(27:10):
like that, and there's a hugedisparity in incomes.
At the time of divorce it's avery good chance that that
spousal support obligation willnot.
Your spouse support waiverWould not be upheld because it
would be determined to beunconscionable by a court.
So there's all kinds of thingsto think about with a prenuptial
agreement, and having afinancial person there to help
(27:32):
is Is very important.
I also think Not justprenuptial agreements but, mark,
I've seen you help people thatare like if they're not sure
they want to get divorced.
Pete Roussos, MFT (27:41):
Yeah.
Mark Hill, CFP, CDFA (27:43):
Tramony, as I call it.
Shawn Weber, CLS-F (27:44):
Yeah, they committed.
Mark Hill, CFP, CDFA (27:46):
Money in matrimony.
Shawn Weber, CLS-F (27:49):
Yeah, you see, you have a couple, they've
committed matrimony, they gotmarried, yeah, and, and they've
got, they've got money issues.
You know, every couple has akryptonite.
I always say and for somepeople the kryptonite is just
the money yeah, and so you know,if you're, I'll do marital
mediation, where you actuallymeet with folks and talk to them
(28:09):
about whether there's somethinghere to save.
Yeah, and they agree tocontinue the marriage, and what
would that look like?
Well, having a Financialspecialist involved there can be
very useful because, number one, you can see what would the
case look like if you were toget divorced.
What would your financespossibly be?
And B, if money is thekryptonite, maybe there's
(28:31):
something that a financialplanner can do to help you solve
that for that kryptoniteproblem.
Mark Hill, CFP, CDFA (28:37):
Yeah, and, and you know, I think you and I
had a case a couple years backwhere the couple really wanted
to stay married and Husband hada very good career, a huge stock
options wife just wanted some.
She was a free spirit wife,just wanted some money in her
name and they came to us forthat, you know, basically to
(29:00):
help them negotiate somethingthat would meet both of their
needs and keep them married.
Pete Roussos, MFT (29:07):
And it is a case like that, it sounds like
may or may not result in apost-nuptial agreement.
Mark Hill, CFP, CDFA (29:14):
You know, I don't know that they ever
signed the agreement.
We did it for them and I thinkthey just went to sleep and went
away and they are hopefullyhaving happily ever after.
I think that's what happened,Mark, with that note.
Shawn Weber, CLS-F (29:27):
Yeah, yeah, that does happen.
Or it could be there's apost-nuptial agreement that gets
executed, or they actuallydecide to get divorced.
Or maybe they don't want to getdivorced.
They get a legal separation,which is basically, I always say
, it's exactly like a divorce,except you're still married.
Mark Hill, CFP, CDFA (29:41):
Yeah, and there may be religious grounds
for that yeah.
When people just think it's notappropriate to divorce yeah.
Shawn Weber, CLS-F (29:49):
So, yeah, their own morality doesn't allow
for the divorce, but they knowthey need to do something, and
sometimes it's just the financesare the issue.
Maybe they just have differentmoney styles he likes to play
fast and lose on the stockmarket and she's more
conservative.
We've seen all kinds of stufflike that.
Mark Hill, CFP, CDFA (30:08):
That's a fact in very common.
It's very rare that remember Ispent 30-odd years as a
financial advisor managingpeople's money back when I had
the wealth management firm andit's very rare that both of a
couple are on the same page interms of risk profile.
Frankly, they usually.
We used to get people to fillout a risk profile and say you
(30:30):
know, in the event, the marketdoes this, this is what this
account would do, this is whatthis account would do on the
upside and the downside, andit's very rare that they both
checked the same box.
Usually one is more conservativethan the other, and it's not
always predictable as to whichone it might be the moneyed
spouse or the un-moneyed spouse.
You know it's yeah.
Well, money in marriage is ajourney, folks, and most people
(30:59):
set off almost settingthemselves up for failure by
failing to talk about it anddiscuss it because they don't
want conflict, you know?
Oh, money is always a problem.
I remember my mom and dad usedto fight about it all the time.
I don't want to bring it up,you know, and I get it.
I understand that.
(31:19):
You know we all not all, butmost people avoid conflict if
possible, and the problem withthis is that conflicts in
marriage, in my experience, areunavoidable and therefore, how
do you handle them is the issue,and education and understanding
the issues make it easier tohave a conversation that doesn't
(31:42):
go sideways.
Shawn Weber, CLS-F (31:45):
Well, you know there's also this thing
that happens in divorce.
You know we like to think thatpeople are rational about their
money.
You know we think of theinvisible hand of the market
moving people towards rationalchoices, but really we make our
money decisions based on anemotional need most of the time,
wouldn't you agree, mark?
Mark Hill, CFP, CDFA (32:07):
I once saw a statistic that people spend
three times as much timedeciding which kitchen
appliances to buy than they doin making their financial
investment decisions.
You know really, and that wasyou know, some Harvard study or
something you know, and thinkabout it.
Shawn Weber, CLS-F (32:25):
I believe that.
I mean, if people, if peoplewere purely rational when it
came to buying a car, why wouldyou have all these commercials
on about the feelings that youhave when you buy your vehicle?
You know?
And so that happens in divorce.
(32:46):
People get irrational.
They may apply a value tosomething that isn't appropriate
, yeah, and because of anemotional need.
And so having the financialspecialist in there who's just
there looking at the math, Imean, there's nothing more
neutral than math.
Mark Hill, CFP, CDFA (33:05):
I always say I can't make the numbers do
any different folks.
They are what they are.
Shawn Weber, CLS-F (33:11):
But that kind of opens the door for our
next week's conversation, whichis going to be about why it
would be important to have amental health professional
involved in your divorce case,because people aren't rational
when it comes to making choices,even if we think we are.
Pete Roussos, MFT (33:27):
Well, I think that there's also still this
expectation that I think, mark,what you were saying about
people being conflict avoidant,I agree with that but there's
also this idea that, you know,marriage just, it just should be
this organic process thathappens naturally and it'll fall
into place and you know the waythat I talk to people about it
(33:51):
is well, when else in life dothe things that are really,
really important?
When else do they go?
Well, if you just leave it allup to chance, you know how many
businesses are successfulwithout a business plan, for
example, where roles andresponsibilities aren't defined?
And then and money, you know,is one of the big four issues
(34:13):
that couples have tension andconflict about.
Mark Hill, CFP, CDFA (34:19):
What is the thought like the imagining
children and sex, two of them.
Pete Roussos, MFT (34:24):
In-laws.
In-laws.
Mark Hill, CFP, CDFA (34:26):
In-laws.
Pete Roussos, MFT (34:26):
Yeah, parenting and sex.
Shawn Weber, CLS-F (34:28):
Yeah, or as I call them sometimes, the
outlaws yes, yeah, oh, yeah,well, guys, we did it again.
Pete Roussos, MFT (34:38):
Well, just one suggestion, and this is not
an area of expertise for me, butI think Sean and I so respect
and appreciate the way youtechnically manage these
podcasts.
One suggestion I have is, ifyou're doing search engine
optimization for this episode,you don't use the words anal
probe.
I'm very glad.
Shawn Weber, CLS-F (35:02):
You know, who knows what will come out of
it.
Pete Roussos, MFT (35:04):
It was my responsibility to do that, that
we're not going to focus on it.
Shawn Weber, CLS-F (35:10):
Thank you Well, on that note, on that
happy note, I always want tofinish my podcast with the words
anal probe.
So, mark, yes, if people didwant a financial anal probe if
(35:34):
people need financial help andtheir divorce.
What should they do?
Mark Hill, CFP, CDFA (35:39):
They should go to my company website.
It's Pacific Divorce Management.
It's the name of the company.
The website is address ispackdivorcecom.
P-a-c-d-i-b-o-r-c-e.
There's a lot of informationabout the company, about what we
do, and also a contact form ifyou'd like to reach out and have
a conversation as to how wemight help you.
Shawn Weber, CLS-F (36:02):
Okay and Pete, if people need to talk to
a mental health professionalabout their divorce process,
what should they do?
Pete Roussos, MFT (36:08):
So you could reach me through my website,
which is peterrusoscom, and thispodcast is very focused on the
dynamics of divorce, but I thinkof myself as, first and
foremost, as a couples therapist, and so if people are
struggling in their marriage andthey would like help with that,
please take a look at mywebsite.
(36:31):
It'll give you a sense of how Iwork and you can contact me
from the contact me page on mywebsite.
Shawn Weber, CLS-F (36:38):
Okay, and for me, if you need help with
the legal aspects of yourdivorce or if you have any
dispute that you need help withresolving,
webberdisputeresolutioncom isthe website that's Weber with 1B
, like the grill dispute, likewe had a fight in resolution,
like we solved it.
Webberdisputeresolutioncom andyou can set up for a free
(37:02):
15-minute meet and greetconsultation and we can talk
about how we can match you withthe right process to resolve
whatever dispute you might have.
Okay, guys, well, we'll do nexttime.
We will talk about how to use amental health professional as
part of your mediation process.
(37:24):
Thanks for listening to anotherepisode of the Three Wisemen of
Divorce Money, psych and Law.
If you like what you heard, besure to subscribe, leave us a
review and share with us Withothers who may be in a similar
place.
Until next time, stay safe,healthy and focused on a
positive, bright future.
This podcast is forinformational purposes only.
(37:48):
Every family law case is unique, so no legal, financial or
mental health advice is intendedduring this podcast.
If you need help with yourspecific situation, feel free to
schedule a time to speak withone of us for a personal
consultation.
Thank you.
Well, just one suggestion, and this is not
an area of expertise for me, butI think Sean and I so respect
and appreciate the way youtechnically manage these
podcasts.
One suggestion I have is, ifyou're doing search engine
optimization for this episode,you don't use the words anal
probe.
Shawn Weber, CLS-F (00:24):
Welcome to the Three Wisemen of Divorce
Money, psych and Law podcast.
Sit down with the Californiadivorce experts financial
divorce consultant Mark Hill,marriage and family therapist
Pete Rousos and attorney SeanWeber for a frank and casual
conversation about divorce,separation, co-parenting and the
(00:44):
difficult decisions real peoplelike you face during these
tough times.
We know that if you are lookingat divorce or separation, it
can be scary and overwhelming.
With combined experience ofover 60 years of divorce and
conflict management, we are herefor you and look forward to
helping by sharing our uniqueideas, thoughts and perspectives
on divorce, separation andco-parenting.
(01:07):
Okay so, mark, you and I weretalking offline about a movie
with Jack Nicholson and KathleenTurner.
What was it called?
Again, prixie's Honor.
Mark Hill, CFP, CDFA (01:20):
I always quote it when it comes to how
important is money in divorce.
The story of the movie is thatKathleen Turner and Jack
Nicholson are both hit men orhit people for rival mob
organizations.
Somewhere during thetransactions a million dollars
(01:42):
which was a lot of money back inthe 18s, probably when this
movie was made has gone missingin a briefcase.
At one point Jack Nicholsonsays to Kathleen Turner no, no,
no, you don't understand.
The Prixies really love theirmoney.
They love their money more thantheir children and they really
(02:02):
love their children.
That's how money is in divorceis that people love their
children, but they also lovetheir money.
It's a really important pieceof the pie.
The question becomes how do youhandle that?
What's the most appropriate wayto do it?
Many clients say well, I've gota CPA and I've got a financial
(02:24):
advisor, they can do that for us.
My response to that is theydon't have the training.
Since I was a financial advisorand had my own wealth
management firm for many, manyyears, I know what that role is.
I know it's very different thanthe role that a financial
neutral takes in a divorce case.
(02:44):
The education is different andthe knowledge required is
totally different.
I would say that in most cases,since this is probably going to
be the largest financialtransaction of a client's
lifetime, it would be prudent tohave somebody who's really
experienced in doing this work,especially if you're going to
(03:07):
mediate it and you are trying tostay out of rival experts in
every field.
Shawn Weber, CLS-F (03:16):
Last time we talked about why it's important
to have an attorney as part ofyour mediation, which naturally
makes plenty of sense.
I think attorneys areabsolutely essential.
I speak as an attorney youwouldn't, wouldn't you?
But I think this part, too, isabout why it's important to have
(03:41):
a financial specialist as partof your divorce mediation.
I think for a lot of cases,it's every bit as important as
the attorney having thefinancial specialist involved in
your case, because there arethings that you might not think
about if you didn't have theright professional on the case.
Mark Hill, CFP, CDFA (04:03):
Yeah, and very often there's an imbalance
of power because of thisimbalance of knowledge around
the money.
Shawn Weber, CLS-F (04:10):
Right, you said that before you have the
moneyed spouse and thenon-moneyed spouse.
Sometimes I'll call thefinancially curious spouse
versus the not so curious.
Mark Hill, CFP, CDFA (04:20):
Yeah, and the reality is that, in order to
be a participant in thisprocess, the concept of informed
consent comes up, which meansthat you could agree to anything
in a mediation process, as longas you understand what you're
doing and what might happenunder other circumstances.
Shawn Weber, CLS-F (04:40):
I've even had people are like well, I
don't care about the money, Ijust care about the children.
And then you start talkingabout the children and meeting
their needs and then you realizethat actually they have to care
about the money because we'vegot to figure out how to make
sure the kids are supported.
Mark Hill, CFP, CDFA (04:56):
So my role is essentially to first of all
quantify the marital estate andthe assets and debts that both
people have and the income andexpenses that they are going to
be dealing with.
Once we've quantified it, we dothe court forms.
Sean, most lawyers don't go tolaw school because they love
(05:19):
arithmetic.
I certainly did not.
They tend to like words andconcepts is what drives people
to law school.
What we can do is usually morecheaply and candidly, more
accurately the most attorneys iscreate the necessary what are
called disclosure forms thathave to occur at least once in
(05:42):
the divorce.
So we quantify the estate, wedo those forms and then we
evaluate it, we take a look atit and we go.
What's going to be challenginghere?
Has there been commingling ofassets that were in existence
before marriage?
Has there been a long timesince the data separation with
the courts?
Long time since the dataseparation with contributions,
(06:03):
say, for example, going toretirement accounts, those kinds
of things that we are aware of,that clients perhaps would not
think of as important issues,but they can be worth hundreds
of thousands of dollars.
And then we educate whennecessary.
Back to what I was sayingbefore about making sure both
(06:23):
parties can be participants atthe table so that they can have
that informed consent, so whenthey make an agreement they know
what they're doing.
And also, sean, you and I areoften at the table together
facilitating this process.
So I think, if that is, thefour step stage is quantify,
evaluate, educate and facilitate.
Pete Roussos, MFT (06:48):
You know, I certainly.
My sense is that most whenpeople go into a divorce process
, the professionals that they'remost likely to encounter first
as an attorney.
So, sean, how do you say more,if you would, about how you talk
to people about why it reallyis in their best interest to
(07:09):
have additional professionals towork with, to bring in a
financial specialist, and how doyou talk with them about the
concerns that they have aboutthe cost of a process and
bringing additionalprofessionals in?
Shawn Weber, CLS-F (07:24):
Well, I mean , the first thing is number one.
I kind of do a little minievaluation of my own.
If it's something I feelcomfortable dealing with, I'll
deal with it.
You know, and that's a very lowbar, it's a very low threshold.
You know, some cases really arethat simple.
They just have a house and theyhave a couple of bank accounts
(07:45):
and maybe an IRA.
You know, some cases are likethat, they're that simple.
But there is a level ofcomplexity where it becomes very
clear to me that a financialspecialist is essential, not
just it would be nice, but itwould be essential.
Pete Roussos, MFT (08:00):
Mark is well to you both.
So what is that?
I'm thinking of people that arethinking about divorce.
Can you describe what thatthreshold is, the specifics of
it?
What are the things?
If you will, the red flags, ifyou will that suggest to you,
they really need to bring afinancial specialist in.
Shawn Weber, CLS-F (08:23):
For me.
I look at, you know, the networth.
I also look at just thecomplexity of the assets.
If they have multipleretirement accounts, not just
one or two, if they havedeferred compensation, if they
have RSUs or stock options.
If there's a business, you knowall of these things can kind of
(08:50):
work together.
I mean, do they have multiplestock accounts and multiple
positions?
You know, then it quickly getsbeyond what I should be helping
people with.
And if it requires expertise toreally understand it, then you
should hire the right expert forit.
(09:11):
And I always tell my clientswhen they complain about the
cost level.
You know it's the three R's.
You want to get the rightperson to do the right work for
the right price.
So you don't want to pay myattorney rate to analyze
someone's stock options.
That would be foolish, you know.
And the other piece is whenthere's some disparity in
(09:35):
knowledge.
That's a really big red flagfor me where I'll want someone,
like a mark, to come in and helpkind of level the playing field
between the moneyed spouse andthe non-moneyed spouse.
And oftentimes you'll have themoneyed spouse say well, I
understand all of this stuff, Ihandle this, you know, I'm a
financial advisor myself.
I don't need to hire acertified divorce financial
(09:57):
analyst to do this, so I couldjust do it myself, and Mark
taught me this years ago.
And you say to the person well,you're at a real disadvantage,
aren't you?
What do you mean?
Well, your spouse wouldn't knowa good deal if it bit her in
the leg, bit him in the leg,because they just there's no way
they can know, and usually youknow you'd think that would
(10:17):
offend the other person.
They're nodding their heads,that's right, I wouldn't know.
Mark Hill, CFP, CDFA (10:21):
And often the person that is the moneyed
spouse will say offline yeah,I've been trying to get him or
her engaged for the last 20years and that hasn't worked.
So they will often admit thatand there's nothing unhealthy
about that.
There's nothing unhealthy about, you know, when you have a
(10:43):
marriage, of the division oflabor I mean it's kind of one of
the benefits of being married,frankly but nobody signs a
contract.
When they get back from thehoneymoon says you're going to
do the yard and I'm going to dothe cooking and I'll take care
of the kids and you earn themoney.
But that's how things evolveover time and so that creates
that imbalance of power that Ialluded to earlier that we
(11:05):
really need to try to dissipate.
Before you get into substantiveconversations and start, you
know deciding what goes whereand who gets what.
Shawn Weber, CLS-F (11:18):
Yeah, yeah, I think that's a big piece of it
, and just letting people knowthat this isn't wasting money,
this is saving you money in thelong run.
Yeah, because you know,especially when you're talking
about larger amounts of money,if you know a little swing in
(11:39):
your analysis of just a fewpercentage points could be big
money, yeah, and so why take thechance?
Go ahead and hire somebody thatcan be on your team, who can
help you with that analysis.
Mark Hill, CFP, CDFA (11:55):
And the other thing I'll say is that
when a marriage breaks down, Ithink it's almost universal that
there's been a breakdown intrust at some point, and so you
may have somebody who's veryknowledgeable, who's ready to
come in with their spreadsheetsand their analysis, and it may
(12:15):
be totally kosher and it mightbe correct in every regard.
However, is the other persongoing to believe it?
If there has been a breakdownof trust on other issues?
I've seen cases where there'sbeen impidelity and the response
is well, if he, she, lied aboutthat, they must have lied about
everything else.
So I can't trust them.
So having a third party to sayyou know what, it is okay and I
(12:39):
can tell you that it's okay,often gives comfort and allows
the process to move forward.
Pete Roussos, MFT (12:45):
You know I'm thinking of Mark in terms of
what you're just describing.
You know you're talking aboutgood faith, dynamics and
something that we've touched onbefore in the context of
mediation or in terms ofcollaborative process.
It really is basedfoundationally on an expectation
of good faith, on anexpectation of transparency, and
(13:10):
I think that would be just auseful thing for us to really
reiterate the absoluteimportance of that to these
processes that we're talkingabout.
Mark Hill, CFP, CDFA (13:18):
I couldn't agree more.
And the flip side of that is itonly takes one violation of
that in order to destroy theprocess.
You know, and I've seen thathappen.
It's rare but you know, withsome it's what I used to call
the smartest guy in the room,and sometimes it's the smartest
(13:40):
gal in the room.
But there are people who comeinto the process thinking
they're going to be smarter thanall of the professionals in
there and it's my job, from afinancial standpoint, to disavow
them of that concept veryquickly, because if someone's
coming in thinking they canmanipulate the process, I want
to terminate that processquickly.
(14:00):
Or you know, I'll have a cometo Jesus meeting and says hey,
you're at risk of that if youdon't.
You know, if you do this againsort of thing and sometimes it's
not just somebody providingwrong information Somebody's
dragging their feet can have thesame impact and I'm failing to
provide things and dragging itout.
(14:21):
Eventually the other spousegoes to hell with this.
I need some teeth and thereforeI'm going to litigate this and
then you're off to the races andwe're act.
Pete Roussos, MFT (14:30):
Mm, hmm, mm hmm.
Shawn Weber, CLS-F (14:33):
Well, one of the things I also like about
with having a financialspecialist is those cases where
the parties just don't seem tohave time to do their
disclosures.
You know, and it's been monthsand months and months, I can't
get them to move forward ondoing the mandatory disclosures.
You know, at least inCalifornia, there's the income
expense declaration that'smandatory and a schedule of
(14:54):
assets and debts.
They have to provide two yearsof tax returns, statements of
material facts and informationand exchange that and that
usually in a mediation, ends upbeing the most annoying part of
the process.
Mark Hill, CFP, CDFA (15:08):
Everybody hates filling out forms.
Shawn Weber, CLS-F (15:11):
Me included right.
Mark Hill, CFP, CDFA (15:12):
Yeah, I get it, but if you don't do it,
you know this is one of mybiggest frustrations is I have
two clients, right, I have ahusband and a wife, okay, and
both of those clients have to doa certain amount of work.
One of them is very diligent,gets it all done.
(15:34):
The other one doesn't.
They're busy, they're traveling, they've got stuff going on
with the family, whateverThey've got their excuses, and
the months go by and eventuallythey provide us with everything.
However, all the dates on thestatements from the other stuff
are now aged out.
It has to be what 60, 90 daysyou know it's supposed to be on
(15:57):
those forms the statements mustbe within.
So if someone doesn't respond,that can be very disruptive
because A I've got to chargeagain to update all the numbers
Not a huge amount, but it'sgoing to have a cost.
There's also a time, and thenthe person that did it in an
appropriate and timely fashionis now being penalized and
(16:22):
having to do it again, whichagain can be very disruptive to
the process and can really sendit off the rails.
So you need a financial advisor,folks, if you have.
Now, the only cases really arethe ones that are simple, like
Sean indicated before, wherethey don't have much on the way
(16:44):
of assets.
I'll say something elseShort-term marriages too, very
short-term marriages, perhaps,if we're not necessary, and what
I call the college divorce,where you get the dog and I'll
take the books and have a nicelife, that kind of stuff that I
think is a rarity coming to us,because a lot of those people
(17:07):
just go pro, pro and they justtake care of themselves and we
don't even see them.
Pete Roussos, MFT (17:11):
Well, what is it, Mark, about short-term
marriage?
Mark Hill, CFP, CDFA (17:15):
Well, in a short-term marriage, if it's
short enough.
I don't want to step on yourshoes, sean, but support is not
an issue.
If it's very, very short-term.
Also, they haven't had perhapsthe time to accumulate assets
during the marriage that need tobe distributed.
You've got a couple of years ofmarriage.
Well, do they care that they'veboth been contributing to 401Ks
(17:39):
?
Probably not, unless there's ahuge disparity, if there's not a
huge disparity in income.
Those are very simple cases.
But the longer a marriage goes,the more complex it becomes and
the more challenging it becomes,because so many times we have
cases where one or both of theparties own real property before
(18:00):
the marriage.
The houses were sold during themarriage and then they bought a
house together.
So we need to do what's calleda more Marsden tracing.
That says how much of theoriginal funds that went into
the purchase of that propertyduring marriage came from each
one of them and how do they getcredit for that.
(18:22):
The longer and then the longera marriage is where there are
retirement accounts that werebrought in, then they continue
to contribute to during themarriage for 20 years.
How do we work out?
What was the premarital shareof that and do they care?
But if you can't quantify it,you can't decide if you care or
not.
I always almost to the point ofbeing annoying in these cases,
(18:48):
I want a number.
Once we've got a number, thenwe can talk about it.
But often in these cases it'swell, I deserve this and I
should get that and so and so.
Well, what does that mean?
What does this mean?
Why put a number on it and thenwe can talk about it and decide
if the other side cares.
Shawn Weber, CLS-F (19:10):
I was thinking about the objections I
received from clients about oh,I don't want to pay for a Mark
Hill, I don't want to pay for afinancial specialist, I don't
want to do this.
I think that one of theobjections would be added cost.
They think it costs too much.
The other would be that theythink it makes it too complex.
And the third is they'refearful that when they think of
(19:32):
a financial person, they thinkof forensics and they think
they're going to be undergoingan anal probe.
Now, and I can assure you Markdoes not want to do an anal
probe.
Mark Hill, CFP, CDFA (19:41):
I do not.
And also my background is as afinancial planner.
A financial planner's focus ismore on the future.
I mean, we've got to know whereyou stand today.
But we're not accountantsforensic accountants always
looking backwards, we're lookingforwards.
Now we can do pretty goodtracing in my office, but there
(20:03):
have been a couple of occasionsduring my career where I've
actually suggested we hire aforensic accountant to go do the
tracing because candidly, Iadmitted it was beyond my pay
grade.
Shawn Weber, CLS-F (20:14):
Yeah, I mean , if you need a business
appraisal, you have to hiresomebody to do specialty work
there.
But as far as cost is concerned,it goes back to that.
It's kind of economies of scale.
You're paying the right personto do the right work, so
actually in my opinion itreduces the fees and gives you a
(20:37):
better product.
Then, when you're talking aboutcomplexity, it does not
increase the complexity, itactually simplifies.
Yeah, If you have complexityalready a good financial
specialist can take challengingsubjects and can reduce it to a
form that's digestible so thatyou can then make decisions Then
(21:01):
it's not overly intrusive.
What would be overly intrusiveis if you went to court and then
we hired forensic accountantsand then there were depositions
and people were subpoenaing youremployer.
Mark Hill, CFP, CDFA (21:15):
That is intrusive and you have two
attorneys doing all thesenumbers and then spending months
and thousands of dollarsarguing over what the pie is.
Shawn Weber, CLS-F (21:24):
But if we could keep it within the
mediation context.
The financial specialist fallsunder the mediation
confidentiality, which meansit's more private, it's more
mutual, the information is thereand people can make decisions.
Pete Roussos, MFT (21:47):
We're talking about the role of the financial
specialist in a divorce process, a divorce mediation.
I'm curious, Mark, do you alsoget involved?
Is there a role that you havefor couples that are looking to
marry and are wanting to puttogether a prenup?
Was there a discussion you getinvolved in?
Mark Hill, CFP, CDFA (22:09):
Yes, it's fairly rare People quite
honestly, they probably have hada divorce before to consider it
.
Because people go in withrose-coloured glasses, shall we
say, to most relationships anddon't think about it until
things turn sour.
But if you've been throughdivorce or you've had a family
(22:31):
member or your parents wentthrough it, people are much more
.
Or if there's a huge disparityin the wealth, where you have an
extremely wealthy personmarrying somebody who has less
funds, that's not uncommon tohave that done.
I've had people say, oh, I don'twant to do that, it would break
(22:52):
the romance.
Well, yeah, but wouldn't yourather have the conversation
when you're getting along thanwhen you're wanting to get
vengeance against each other orthey're perceived crimes during
the marriage?
I would say, yes, but it's ararity.
(23:13):
But when it comes through thedoor, I can certainly help on it
because first of all, I canhelp explain the rules, how this
works, and I'm commingling whenyou put your funds in with
somebody else's funds, somebodyelse being your spouse, does
that change the character ofyour property?
There's rules around that andyou need to understand them in
(23:36):
order to not have surprises downthe road.
I've had many people say, oh,if only I'd known I wouldn't
have done that.
Shawn Weber, CLS-F (23:46):
To be clear, the level of disclosure that's
required for a prenuptialagreement is the same as what's
required for a divorce.
So there's a lot of work thatneeds to be done.
If you don't disclose them, ifyou get something wrong and
somebody relies on that, thenthe prenuptial agreement could
be worthless.
So having a financial personhelp you put the disclosures
(24:07):
together is a really good pieceof insurance.
Mark Hill, CFP, CDFA (24:10):
And then also.
Shawn Weber, CLS-F (24:11):
I'm sorry, mark, go ahead.
Mark Hill, CFP, CDFA (24:12):
What I was going to say.
It sets the relationship off onthe right footing.
People go into marriages, intorelationships, with assumptions
we seldom discuss with the otherperson.
Oh really, you expect me towork after we get married?
Oh, I didn't know that, or what.
(24:34):
You're going to retire in threeyears.
You didn't tell me that, thosekind of things.
It's helpful to have thoseconversations before, as I say,
when you're getting along.
Shawn Weber, CLS-F (24:49):
Well, and I always tell people you have a
prenup already written, whetheror not you actually sign one.
Yeah, if you don't make yourown prenup, then you have a
prenup that was written inSacramento by the legislature,
you know, or whatever stateyou're in.
Yeah, but you know, thinkingabout these things beforehand,
and I think the thing thathappens that maybe you've seen
(25:09):
this mark is Is when people arethinking about getting married,
all they're thinking about ispicking out China and where am I
registered and what's thewedding gonna be like, and they
don't want to have to thinkabout these things.
Yes, yeah, but they reallyshould.
And and take the time to do itright.
Don't just do a half-buttedDisclosure.
Make sure it's a complete andthorough disclosure.
(25:30):
You want to make sure thatyou're gonna spend the money and
time on a prenuptial agreement,that it's something that'll be
useful to you enforceable yeahand enforceable.
Mark Hill, CFP, CDFA (25:38):
Yeah, I mean and and and, and you know
you and I have had theseconversations many times about
prenups.
You know we've seen good, thegood, the bad and the
indifferent, haven't we man?
We've seen ones that, you know,because of change of
circumstances, may not be valid.
You know, we've seen ones whereone of the parties, over a
(26:00):
20-year marriage, just doesincredibly well, has a huge
amount of money, and the otherone Didn't do so well, you know,
because of inheritance orbecause of some separate
business interest or somethinglike that.
And now there's a realimbalance there.
And what's the term?
(26:20):
The difference between the, theincome or the?
Well, yeah, Unconscionable.
Shawn Weber, CLS-F (26:28):
So it's so in California and it may be
different in different states,but in California the
Conscionability of a spousalsupport waiver, hmm, it is
determined at the time ofenforcement, not at the time of
signature.
So what I mean by a contract, adefense to a contract, is a
contract will not be informed ifit's determined to be
(26:50):
unconscionable.
I mean it's so awful that itshocks the senses.
And We've had cases and in factI got one now where when they
got married they had similarincomes Maybe they had nothing
and then during the marriage oneof them developed a career and
the other one Became astay-at-home parent or something
(27:10):
like that, and there's a hugedisparity in incomes.
At the time of divorce it's avery good chance that that
spousal support obligation willnot.
Your spouse support waiverWould not be upheld because it
would be determined to beunconscionable by a court.
So there's all kinds of thingsto think about with a prenuptial
agreement, and having afinancial person there to help
(27:32):
is Is very important.
I also think Not justprenuptial agreements but, mark,
I've seen you help people thatare like if they're not sure
they want to get divorced.
Pete Roussos, MFT (27:41):
Yeah.
Mark Hill, CFP, CDFA (27:43):
Tramony, as I call it.
Shawn Weber, CLS-F (27:44):
Yeah, they committed.
Mark Hill, CFP, CDFA (27:46):
Money in matrimony.
Shawn Weber, CLS-F (27:49):
Yeah, you see, you have a couple, they've
committed matrimony, they gotmarried, yeah, and, and they've
got, they've got money issues.
You know, every couple has akryptonite.
I always say and for somepeople the kryptonite is just
the money yeah, and so you know,if you're, I'll do marital
mediation, where you actuallymeet with folks and talk to them
(28:09):
about whether there's somethinghere to save.
Yeah, and they agree tocontinue the marriage, and what
would that look like?
Well, having a Financialspecialist involved there can be
very useful because, number one, you can see what would the
case look like if you were toget divorced.
What would your financespossibly be?
And B, if money is thekryptonite, maybe there's
(28:31):
something that a financialplanner can do to help you solve
that for that kryptoniteproblem.
Mark Hill, CFP, CDFA (28:37):
Yeah, and, and you know, I think you and I
had a case a couple years backwhere the couple really wanted
to stay married and Husband hada very good career, a huge stock
options wife just wanted some.
She was a free spirit wife,just wanted some money in her
name and they came to us forthat, you know, basically to
(29:00):
help them negotiate somethingthat would meet both of their
needs and keep them married.
Pete Roussos, MFT (29:07):
And it is a case like that, it sounds like
may or may not result in apost-nuptial agreement.
Mark Hill, CFP, CDFA (29:14):
You know, I don't know that they ever
signed the agreement.
We did it for them and I thinkthey just went to sleep and went
away and they are hopefullyhaving happily ever after.
I think that's what happened,Mark, with that note.
Shawn Weber, CLS-F (29:27):
Yeah, yeah, that does happen.
Or it could be there's apost-nuptial agreement that gets
executed, or they actuallydecide to get divorced.
Or maybe they don't want to getdivorced.
They get a legal separation,which is basically, I always say
, it's exactly like a divorce,except you're still married.
Mark Hill, CFP, CDFA (29:41):
Yeah, and there may be religious grounds
for that yeah.
When people just think it's notappropriate to divorce yeah.
Shawn Weber, CLS-F (29:49):
So, yeah, their own morality doesn't allow
for the divorce, but they knowthey need to do something, and
sometimes it's just the financesare the issue.
Maybe they just have differentmoney styles he likes to play
fast and lose on the stockmarket and she's more
conservative.
We've seen all kinds of stufflike that.
Mark Hill, CFP, CDFA (30:08):
That's a fact in very common.
It's very rare that remember Ispent 30-odd years as a
financial advisor managingpeople's money back when I had
the wealth management firm andit's very rare that both of a
couple are on the same page interms of risk profile.
Frankly, they usually.
We used to get people to fillout a risk profile and say you
(30:30):
know, in the event, the marketdoes this, this is what this
account would do, this is whatthis account would do on the
upside and the downside, andit's very rare that they both
checked the same box.
Usually one is more conservativethan the other, and it's not
always predictable as to whichone it might be the moneyed
spouse or the un-moneyed spouse.
You know it's yeah.
Well, money in marriage is ajourney, folks, and most people
(30:59):
set off almost settingthemselves up for failure by
failing to talk about it anddiscuss it because they don't
want conflict, you know?
Oh, money is always a problem.
I remember my mom and dad usedto fight about it all the time.
I don't want to bring it up,you know, and I get it.
I understand that.
(31:19):
You know we all not all, butmost people avoid conflict if
possible, and the problem withthis is that conflicts in
marriage, in my experience, areunavoidable and therefore, how
do you handle them is the issue,and education and understanding
the issues make it easier tohave a conversation that doesn't
(31:42):
go sideways.
Shawn Weber, CLS-F (31:45):
Well, you know there's also this thing
that happens in divorce.
You know we like to think thatpeople are rational about their
money.
You know we think of theinvisible hand of the market
moving people towards rationalchoices, but really we make our
money decisions based on anemotional need most of the time,
wouldn't you agree, mark?
Mark Hill, CFP, CDFA (32:07):
I once saw a statistic that people spend
three times as much timedeciding which kitchen
appliances to buy than they doin making their financial
investment decisions.
You know really, and that wasyou know, some Harvard study or
something you know, and thinkabout it.
Shawn Weber, CLS-F (32:25):
I believe that.
I mean, if people, if peoplewere purely rational when it
came to buying a car, why wouldyou have all these commercials
on about the feelings that youhave when you buy your vehicle?
You know?
And so that happens in divorce.
(32:46):
People get irrational.
They may apply a value tosomething that isn't appropriate
, yeah, and because of anemotional need.
And so having the financialspecialist in there who's just
there looking at the math, Imean, there's nothing more
neutral than math.
Mark Hill, CFP, CDFA (33:05):
I always say I can't make the numbers do
any different folks.
They are what they are.
Shawn Weber, CLS-F (33:11):
But that kind of opens the door for our
next week's conversation, whichis going to be about why it
would be important to have amental health professional
involved in your divorce case,because people aren't rational
when it comes to making choices,even if we think we are.
Pete Roussos, MFT (33:27):
Well, I think that there's also still this
expectation that I think, mark,what you were saying about
people being conflict avoidant,I agree with that but there's
also this idea that, you know,marriage just, it just should be
this organic process thathappens naturally and it'll fall
into place and you know the waythat I talk to people about it
(33:51):
is well, when else in life dothe things that are really,
really important?
When else do they go?
Well, if you just leave it allup to chance, you know how many
businesses are successfulwithout a business plan, for
example, where roles andresponsibilities aren't defined?
And then and money, you know,is one of the big four issues
(34:13):
that couples have tension andconflict about.
Mark Hill, CFP, CDFA (34:19):
What is the thought like the imagining
children and sex, two of them.
Pete Roussos, MFT (34:24):
In-laws.
In-laws.
Mark Hill, CFP, CDFA (34:26):
In-laws.
Pete Roussos, MFT (34:26):
Yeah, parenting and sex.
Shawn Weber, CLS-F (34:28):
Yeah, or as I call them sometimes, the
outlaws yes, yeah, oh, yeah,well, guys, we did it again.
Pete Roussos, MFT (34:38):
Well, just one suggestion, and this is not
an area of expertise for me, butI think Sean and I so respect
and appreciate the way youtechnically manage these
podcasts.
One suggestion I have is, ifyou're doing search engine
optimization for this episode,you don't use the words anal
probe.
I'm very glad.
Shawn Weber, CLS-F (35:02):
You know, who knows what will come out of
it.
Pete Roussos, MFT (35:04):
It was my responsibility to do that, that
we're not going to focus on it.
Shawn Weber, CLS-F (35:10):
Thank you Well, on that note, on that
happy note, I always want tofinish my podcast with the words
anal probe.
So, mark, yes, if people didwant a financial anal probe if
(35:34):
people need financial help andtheir divorce.
What should they do?
Mark Hill, CFP, CDFA (35:39):
They should go to my company website.
It's Pacific Divorce Management.
It's the name of the company.
The website is address ispackdivorcecom.
P-a-c-d-i-b-o-r-c-e.
There's a lot of informationabout the company, about what we
do, and also a contact form ifyou'd like to reach out and have
a conversation as to how wemight help you.
Shawn Weber, CLS-F (36:02):
Okay and Pete, if people need to talk to
a mental health professionalabout their divorce process,
what should they do?
Pete Roussos, MFT (36:08):
So you could reach me through my website,
which is peterrusoscom, and thispodcast is very focused on the
dynamics of divorce, but I thinkof myself as, first and
foremost, as a couples therapist, and so if people are
struggling in their marriage andthey would like help with that,
please take a look at mywebsite.
(36:31):
It'll give you a sense of how Iwork and you can contact me
from the contact me page on mywebsite.
Shawn Weber, CLS-F (36:38):
Okay, and for me, if you need help with
the legal aspects of yourdivorce or if you have any
dispute that you need help withresolving,
webberdisputeresolutioncom isthe website that's Weber with 1B
, like the grill dispute, likewe had a fight in resolution,
like we solved it.
Webberdisputeresolutioncom andyou can set up for a free
(37:02):
15-minute meet and greetconsultation and we can talk
about how we can match you withthe right process to resolve
whatever dispute you might have.
Okay, guys, well, we'll do nexttime.
We will talk about how to use amental health professional as
part of your mediation process.
(37:24):
Thanks for listening to anotherepisode of the Three Wisemen of
Divorce Money, psych and Law.
If you like what you heard, besure to subscribe, leave us a
review and share with us Withothers who may be in a similar
place.
Until next time, stay safe,healthy and focused on a
positive, bright future.
This podcast is forinformational purposes only.
(37:48):
Every family law case is unique, so no legal, financial or
mental health advice is intendedduring this podcast.
If you need help with yourspecific situation, feel free to
schedule a time to speak withone of us for a personal
consultation.
Thank you.
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