FULL TRANSCRIPT – SEASON 3, EPISODE 28

Jessica: Are you concerned about money and divorce? It’s one of the biggest fears for people thinking about or going through divorce. Even once it’s finished, money is still on your mind. Money literally affects everything in life. That’s exactly what we’re talking about in today’s episode of the Divorce etc… podcast. We are the exEXPERTS, Jessica and T.H. We focus on helping you navigate your divorce and successfully move on with your life. Please follow us on all social media at exEXPERTS, and check out www.exexperts.com for tons of free divorce related resources. Let’s bring in today’s guest.

T.H.: Hey everybody, today we have Sara Chevere. I hope I said that right. She is a money dynamo. She founded Finance Babe. She does these amazing summits regularly that you’re going to want to chime in on. We’ve been a part of one of them. We are here to talk about the money, the thing that nobody really wants to talk about. They just want it all. We all want a lot of money, but you don’t want to talk about or spend the time to learn how to get it, how to save for it, how to budget. You don’t want to do the work. But Sara is here, and she’s going to explain and give us some tips on how to do it and identify some really important things that you need to know when you’re getting a divorce, and money and debt are certainly issues. Welcome to Divorce etc…

Sara: Thank you. Thank you for having me.

Jessica: We’re so glad to be having you.

T.H.: And I love your accent. I could just listen to it all day, even if I can’t say your last name. It just makes everything sound prettier.

Sara: Well, let me tell you this, my ex husband never liked my accent. Can you guys believe it?

T.H.: Ugh.

Jessica: How do you marry someone if you don’t like their accent?

T.H.: Right? How do you even avoid that anyway?

Sara: Sometimes, men, they might like something at the beginning, and then after that, they find it annoying. That’s what happened with him.

Jessica: That’s us with men too. But we digress because that could be a whole other conversation in itself. Let’s seriously just dive right in. Because honestly, we know that the two biggest fears for—I’m going to stereotype—for women when it comes to divorce, because your company is Finance Babe and focused on women’s financial literacy and education and things like that, like money and kids, the kids are still part of the money thing, right? How am I going to afford all the things that I need with my kids? So what do you see as the most common financial pitfalls that women face during and after divorce?

Sara: Unfortunately, marriage is about love, and divorce is about money. One of the biggest pitfalls is that, dividing all of these assets. Statistically speaking, we know that women lose at least over 70% of their income. I’m talking about over 80% of women, they lose about 70% of their income, which is an issue because, unfortunately, a lot of women, they were under their shadows of their husband for all of those years. Now, they’re getting this reality check that, what am I going to do? Should I keep the house? Should I not keep the house? Am I going to be able to survive? Where’s my retirement? All these questions come in when women are on the verge of divorce. If you get divorced even later on in life, then the most scary part is how am I going to survive? Am I going to be able to retire? How much longer now do I have to go back to work, or how much longer do I have to go to work? Do I have to take care of my parents and now I have this issue that I’m getting divorced? There are a lot of questions that come up when women confront this challenge of do I get divorced or not, even if they are the ones that want to get divorced, right? Let’s be real about that.

Jessica: I feel like there’s an interesting thing that I think that we need to clarify. Because you’re totally right, T.H. and I know it to be true the amount of income that women lose when, again, stereotypically—I should say just the lesser earner in the marriage—how much they lose when going through divorce. But I think that a lot of people who haven’t been through divorce and who are thinking about it in their heads, they’re thinking, “Well, it’ll be half. Everything will be split 50/50.” I think that it’s important to clarify like, okay, but if you even if you get half, now you’re talking about you’ve two households being run, where you’re paying basically double bills in a lot of instances. But can you explain a little bit of that part for people to understand why it’s not what they think in terms of just 50/50?

Sara: Because first of all, for the most part, and like you said, women make less money than men. That means that splitting everything 50/50, and I’m talking about not only the money, but also the debt, it doesn’t work that way. You have to think about these things. You have to think, okay, where is the money right now? Where is it going? Do I know where the bank accounts are? What are the investments that we have? Do I know where these things are? Am I going to be able to afford the house? A lot of women, they say, “No, I’m keeping the house,” but is it real for you? Is there going to be a benefit for you to keep the house? I understand that maybe you’re raising your children there and all this stuff, but you have to be realistic about what is your financial situation at the moment. Then when it comes to debt, fairly, there has to be a way to divide debt as well. It cannot be 50/50. That’s something that you have to also consider. For example, if you’re making only 40% of the income, then the debt that should go to you is only that 40%, not 50%. If you’re making only 30% of the income in the house, so the debt that you will be responsible for should be 30%. Obviously, hopefully, you can have an amicable mediation and amicable divorce, and you don’t even have to worry about that. But if you do, make sure that you have that in mind that hey, I’m the lower or the lesser in the household income. If that is your case, because I know a lot of women that make as much or even more than their husbands, right?

T.H.: So you brought up something important when you’re talking about the house, I mean, money and emotions become very intertwined, right? “Well, I deserve it,” “I want it,” or “This is where we measured my son’s growth on the wall, where we marked it up.” Like, we totally get it everybody; there are emotional ties to a lot of things, a lot of places, a lot of stuff. But the house is a huge asset and also a huge potential source of money for you and for your safety. And so what we have spoken about with some other financial experts is really to picture where you see yourself in a few years, and then work backwards. Are you going to be in this huge house in five years by yourself when your kids are gone and be literally house-poor? Or do you want to live in a smaller place where you have no maintenance, and travel and do the things that you love to do, or not sacrifice your kids sports that they want to do because all the money’s tied up in keeping this house and the gutter guy and the landscape guy and shit breaks and whatever, and not have that headache? Think about it really in terms of business. It’s not cold. This is a business transaction, your divorce. And so you really need to come into it with that mindset. Come to us for the emotional side of it, because we get it because it sucks. You got to sell stuff. I held on to stuff too long. We could go on and on. But I think that’s an important piece to just bring up. Then you also talked about another question is, what kind of assets are really important to consider and think about when you’re going through your divorce in terms of money and your stuff and your settlement?

Sara: So again, what matters at that point is not your current circumstances, but your future circumstances, depending on where you are. If you’re divorcing early on and you’re still young, you have a lot more potential to recover from the divorce and thrive even.

T.H.: Well, Sara, what’s young? What’s young?

Sara: If you’re in your twenties, right? 

T.H.: Okay, okay, super young, just out of college.  

Sara: Correct. Correct; if you’re less than 30. But if you are over 30, now you have to consider other things. Again, where is the money going? What type of investments do we have? Does he have? I have? Do I know the passwords of these accounts? Do I have access to these accounts? Because again, a lot of times when we trust, or sometimes not that we trust necessarily, is that we just don’t want to think about money or the finances. We have this yucky feeling about it, so we delegate that to our husbands, now probably future ex husbands, right? We want to take charge of this. We want to say, “Okay, I’m an adult, and I’m going to take 100% responsibility now for my life and the life of my kids,” if I have kids. So I need to know, which are our bank accounts? Do I have access to them? What are the investments that we have? Do I have access to that? What is in my name? How about life insurance, health insurance, car insurance, the mortgage? You want to know every single detail, and you want to have access to all of these things in order to be clear of what the financial situation is, and what would be the best way to go for you to make the best decisions during your divorce so you can protect yourself and your kids in the future. Like you said, T.H., I was going to say the same thing, divorce is a business transaction. And so was marriage. It is a business transaction, even as much love and romance that we want to see it, it is a business transaction. We are committing as a couple to do all of these things together for a certain period of time. But when it’s ending, it is the end of a partnership. That’s how we have to see it. We have to take, as much as our heart is ripping out, we have to see it as a business transaction and do our best to take all the emotions away and be realistic. Because a lot of times, and I’m going to go back to the house again, a lot of times, there’s no benefit for you to keep the house. Sometimes it’s better to sell it. You’ll be able to embark on a total new endeavor when it comes to something like that.

T.H.: So guys, we’re going to take a quick break here. Because we know it’s hard to get honest and reliable information about your divorce and life in general, so we’ve done the work for you by creating exEXPERTS and the Divorce etc… podcast, and check us out on YouTube also. Jess and I had one another to ask all of the questions and figure out the answers, and we are your no bullshit, no nonsense girlfriends through divorce and life in general. Again, ask us anything about post divorce life and all that comes with it. Be sure to subscribe to our weekly newsletter to get exEXPERTS in your inbox. You can get all of this information and more information about Sara at www.exexperts.com. We’ve lived it, so we get it.

Jessica: So Sara, one of the things that you were talking about in terms of it may not be worth it to keep the house, I mean, that’s always a huge conversation, and we’ve talked about that a lot. We are in the Northeast, and you are not. And so I’m just curious whether or not when you are working with all of your clients who are thinking about divorce or starting to go through the process, are there different patterns that you see culturally, where certain people are like, “I don’t need the house,” and that’s just, again, more maybe a cultural decision, and then other groups being like, “No, I definitely want to have the house”? What are you seeing in terms of those types of patterns?

Sara: I wouldn’t say culturally, but I see more women that have kids, they are the ones that want to hold on to that more than if it was somebody that didn’t have kids. 

Jessica: Okay.

Sara: And it’s understandable, again, because they’re not thinking necessarily about themselves. They’re thinking about their kids that okay, this is going to be on top of the huge shift that we are getting divorced, and now we have to get out of the house. That’s where I see it the most. But again, it is doable. In the end, you will regret if you try to keep something that you cannot afford, right?

Jessica: That you don’t understand.

Sara: We have to do the numbers. We have to sit down, become honest with ourselves, and do our numbers.

Jessica: Do you feel people also understand when they’re going through the process with you that it isn’t just about how to pay for the actual legal fees and to pay for the actual divorce, but having the mind space of understanding that they have to be set up for whatever they anticipate their life to be for years beyond that? Or do you feel most people are thinking, “Well, I’m going to get child support, I’m going to get alimony,” and not really understanding the ramifications of the seriousness of the financials.

Sara: I have seen it all. I have seen women that are in complete denial. It’s sad to say, but they’re like, “I’m going to get $30,000 in alimony out of you,” because again, the emotions are so hard. Then they go into this nonstop legal battle that is so unfortunate, because the money—the reality is the people that win on legal battles like that are the attorneys.

Jessica: Yeah.

Sara: They get the majority of the money. If they would sit down with somebody like me, for example, in order to be able to look at all of this, calculate the numbers and see what is the reality in their circumstances, they could save thousands or even hundreds of thousands of dollars and do everything more amicably. As painful as it can be, it can be more amicable if we actually see it from a numbers standpoint, right?

T.H.: Yeah, I want to chime in because that was partly me. I mean, I wasn’t going through the court and spending money emotionally, but I was dragged into it. But I still participated in it. I will say this to all of you, it’s really hard to figure out the business, the emotions, I’m overwhelmed, I’m getting a divorce, holy shit, I got to move a house, I have three kids, I have schools, I have to get them into school, I have to go to work. I mean, I could ramble on and on for hours about all the things that are spiraling around in your head right now, of all the things you have to worry about. But the numbers are probably your top priority. The dollar signs are your top priority. So come to exEXPERTS to support you, go to the gym, find a class, definitely get a therapist, and work on those things, because you’re only human. It’s very hard to know what’s what. Like, oh, I didn’t know this was emotional. I thought this was this, but my lawyer had to know. I thought I had to tell my financial advisor. You’re just spewing out stuff. We always talk about take a minute, like literally take a minute for yourself to digest whatever news comes your way at any time of any day. Don’t be quick to react, because most reactions that are emotional are going to be a problem. You’re either going to complicate things with your professional team, or with your ex, or your own circumstance. You may have said something because you just wanted it out in the world, which we totally understand. But that might not be the best negotiating tactic. Put the emotions in everything and make sure you have that support, because your support team will help you be able to handle the business. We will be able to help you look at the numbers and get the support of someone like Sara, or other CDFAs, or your forensic accountant, whoever that is. Or just go online and learn it for yourself like at these awesome summits. The more you read and learn you’re going to be like, “Oh, okay, I understand.” The emotions take over when you don’t understand and when you don’t know better. But we have literally lived it, all three of us. I know that for my kids, the house wasn’t the home. The home was me. I was the home, and now they have another home with their dad. Whatever structure we’re living under, we can decorate and make it new for where they are at that age, where they are with their thinking. We can redecorate your room a hundred times, thank you Home Goods and Wayfair. But that is not where they are safe. They are safe with the parents who love them and the family that cares for them. I just want you to think about what I just said. The home is just a structure. I know you want to keep as much stability with your kids as possible, and so a move is definitely not something that’s stable. But if you’re good emotionally and you know your numbers, you’re as stable as you’re going to be at that exact moment. So do those things, those things you can control, and forgive yourself if you make a mistake. We’ve all made mistakes, we’ve all screwed up, and our kids are fine. Jessica has moved more times than most people in an entire lifetime, and her kids are great because she has taken the time to learn to support them, support herself, and be a source of stability for her kids, regardless of what the apartment is that they’re in. So trust us, this is legit. This is trustworthy information.

Sara: I wanted to add that in my experience and also statistically speaking, and I go by statistics a lot because I see this so many times, divorce is very common, right? At least 97% of women, they fired their financial advisors. Why? Because the ex husband was one that chose them, right?

T.H.: So it’s not a neutral party.

Sara: It’s not a neutral party. Again, when you’re going through this, or even if you already have gone through divorce, look for somebody like me, like a financial coach to help you put together these numbers to help you see where you are and all the possibilities that you have. Because again, a lot of times when we go through divorce, the thing that kills us is that we are so focused in our current circumstances, that we forget our possibilities. That’s what we want to focus on, not on what’s happening right now, but all the possibilities, all the things that you can do after the divorce.

T.H.: There are so many opportunities. Jessica’s owned two apartments outright by herself, figured it all out, budgeted it, and made it happen, and made it her special home. Jessica, do you love your home?

Jessica: I am obsessed with my apartment that I live in now.

T.H.: Okay, so you can do that. Look, if you can’t afford a whole new place, or whatever your circumstance, or it’s not the most beautiful home, you can go to Home Goods and you can make it look really pretty, smell really nice, and have a great pillow to sleep on. But you’re not going to sleep well if you don’t face the facts of how much money you have, where the money’s at. Listen to the tips that Sara mentioned at the beginning, learning your passwords, like she mentioned a whole bunch of things that you really need to get in order before anything else happens, like anything. Before you say, “I want a divorce,” you have to get all of these things in order. Then what you don’t know the answers to and you can’t ask your soon-to-be ex, you’ll handle with a lawyer. But at least you know where you stand. It’s so important. Don’t be afraid to face it, you’re so much better knowing.

Jessica: I also want to add I know from our experience with exEXPERTS there are so many, particularly women, out there who feel they can’t “afford” a financial coach or a financial advisor. You can generally always have at least one consultation for free. A lot of times the services that you get from them, that’s not the cost. The cost is the specific transaction. Even if you think you can’t afford it, you almost can’t afford not to have a financial expert on your team. Like Sara said, I mean, I didn’t know that there’s such a huge percentage of women getting rid of the financial advisors that their ex spouses brought in. But the same that we always say about lawyers, you got to find someone who you feel understands you and that you vibe with and that you are comfortable with exposing all of this personal information, because that’s the only way they’re going to be able to help you the best. This is not the time to be withholding information and hiding shit. This is the time to spew it all out, lay it all out on the table so someone like Sara can really dig in there and help you to see the future that you want to have.

T.H.: And you have a partner. You have somebody who’s got your back. That’s what you want. That’s what you need. You never want to feel like any questions you have to ask are dumb, ever. You need to have a partner to make you feel that way.

Sara: Yes, and let me clarify, a financial coach is not an expense. It’s actually an investment that if you talk to your accountant, you can possibly get a tax deduction for that as well.

Jessica: Really?

Sara: Yeah, it’s a possibility. Again, ask your accountant. But when you’re going through a process like this, you definitely need somebody in your corner. This is an investment. Having a financial coach is an investment. It’s going to protect you from so many things. It’s going to is going to help you to have a clear understanding of where you are and where you want to be.

T.H.: And take it as a learning experience. If you’re not well versed in it, take advantage of a financial coach or any education you bring into your life, because then you know better.

Jessica: That’s right.

T.H.: You don’t know what you don’t know, and don’t feel bad and don’t feel dumb about it. You didn’t need to know. Now you need to know.

Jessica: And by the way, if you can write it off, even better.

T.H.: Even better. Bonus!

Sara: You can do those things. If you don’t know then—

Jessica: That’s right. All right, well, we have much more to always—I feel like I end every episode with “we have so much more to say”.

T.H.: Yeah, you do.

Jessica: I have to think of something else. But it’s always so true. But for everyone listening, if you’ve enjoyed this episode of the Divorce etc… podcast with the exEXPERTS today, then please help us out. Because when you subscribe, rate, and review, it helps us get the word out so we can support more people like you going through divorce and beyond. Check out our show notes for more info on Sara and Finance Babe. And of course, share with anyone you know who can benefit from listening. Have a great day.