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Episode 100 - Common Financial Surprises Women Experience Going Through a Divorce

Episode 100 - Common Financial Surprises Women Experience Going Through a Divorce Image

12/04/2018 9:00 am

When you handle hundreds of divorces a year, you start to see certain commonalities. In this show, we discuss some common financial surprises that we see women experience going through a divorce. We also explore some of the causes of those surprises and what to do about them.

Transcript

Leh Meriwether:             Welcome everyone. I'm Leh Meriwether and with me is Todd Orston. Todd and I are partners at the law firm of Meriwether & Tharp. And you are listening to Meriwether & Tharp radio on the new Talk 106.7. Here you learn about divorce, family law, tips on how to save your marriage if it's in the middle of a crisis, and even from time to time, tips on how to take your marriage to the next level. If you want to learn more about us, you can always check us out online at atlantadivorceteam.com.

Todd Orston:                   Well done.

Leh Meriwether:             Thank you. I've been practicing.

Todd Orston:                   Yeah.

Leh Meriwether:             We ready?

Todd Orston:                   A good surprise. No hiccups, no issues. That was smooth. Nicely done.

Leh Meriwether:             Thank you.

Todd Orston:                   But while that's a good surprise, know what isn't a good surprise?

Leh Meriwether:             What?

Todd Orston:                   You know where a surprise maybe isn't a good thing?

Leh Meriwether:             Divorce.

Todd Orston:                   There you go. There you go. We're all about setting expectations and surprises as attorneys, we don't like surprises when we're representing somebody and we have them on the stand and it turns out they like to torture butterflies or whatever. You know, surprises in the context of a divorce, not good for the attorney, but also for clients. And that's what today's show is gonna be about. We're gonna talk about surprises experienced by divorcing women.

Leh Meriwether:             Right.

Todd Orston:                   We're gonna hit it from that gender side. And in the future we're gonna do one on surprises for men that are going through a divorce. But the bottom line is those types of surprises not good. And the surprises we're talking about are ones where someone has gone through the process and maybe they haven't been educated, they don't understand what their rights and obligations are going to be post divorce.

Leh Meriwether:             Right. And so we're gonna focus on financials. Find this particularly financial surprises that women commonly encounter and obviously men may encounter some of these as well, but we're just sort of generalizing. This is what we see as commonly comes up in these scenarios based on ... you could say it's stereotypical, but it's what we commonly see, so that's why we're gonna focus at that level. And in a couple weeks, we're gonna circle back around and do what we commonly see men ... surprises that men have when it comes to the financial issues in the divorce. All right.

Todd Orston:                   Oh I'm done.

Leh Meriwether:             You're done?

Todd Orston:                   I did the ... I laid it all out there. No.

Leh Meriwether:             All right. Well what are we gonna ... what's first?

Todd Orston:                   All right. So number one, unaware of marital spending. Okay. And marital spending, what we're talking about is what I'm gonna call where did all the money go? All right. 'Cause I'm sure you're like me, that if I had a dollar for every time I had a wife and mother sit across the table and were going over financials and you're looking at okay this is what the husband makes, this is what they earn, and then it's every month they are scrambling to try and have enough money to keep the lights on and we really start digging in and we start to see habits, we start to see where some of that money went, and sometimes it's in inappropriate places and it's being used in inappropriate ways.

Leh Meriwether:             Yeah. We often see this especially with stay at home mothers that haven't been necessarily in charge of the finances. They've been taking care of the children, making sure that their spouse or their husband has everything he needs to perform well at work. You see a lot of times people fall into certain roles, which is important in marriages, because it allows the marriage to thrive when they do things the right way. And the husband, you often see the husband will excel at work because the wife is keeping things in control at home.

                                         But usually in those same scenarios the husband is in control of the finances. He's paying all the bills, and often the wife doesn't have a clue what his true income is. She'll get a tax return put in front of her every year and just signs off on it. But she really doesn't know what's in it because she trusts her husband. And there's nothing wrong with that, but that results in we get into these divorce situations, these surprises.

                                         And in some times the surprises you and I may look at certain transactions in some bank accounts, well it looks like you may have had to take care of a hospital bill or this expense or that expense, but the wife may see this big withdrawal of maybe 5,000 dollars, what's going on? Is he hiding money? Did he buy a ring for his girlfriend or something like that? So all of a sudden that surprise almost starts to evolve into something that may not be necessarily true, but because they weren't paying attention questions start coming up.

Todd Orston:                   Yeah. And sometimes it's not some nefarious act.

Leh Meriwether:             Yeah.

Todd Orston:                   Money's not being taken out for improper purposes, but a lot of times there is some irresponsible spending going on. Sometimes the spending is on another person. Until you start digging in, you're not gonna know. You were talking about some of the things that we look at and look for. I've seen it, I'm sure you have also, where we start digging in and there's large cash advances. And it's always happening on a Thursday night or a Friday night and basically while my client was going through the ... living with her spouse, didn't put two and two together.

Leh Meriwether:             Right.

Todd Orston:                   But in the context of a divorce, now all of a sudden it's well that's weird. Every Thursday night he has to work late-

Leh Meriwether:             Right.

Todd Orston:                   And it then turns out that every Thursday night he's going to a cash machine and taking out 5, 6, 700 dollars. And then when we start looking at where the cash machine is, well lo and behold it's right near a dance club or something.

Leh Meriwether:             Or a hotel room.

Todd Orston:                   Or a hotel. Right.

Leh Meriwether:             One you can rent by the hour.

Todd Orston:                   Yeah. So basically large cash withdrawals, secret bank accounts, money transfers that you just didn't know about. We've seen people transferring money. Sometimes it's to a paramour or somebody they are romantically involved with, sometimes it's to family.

Leh Meriwether:             Yeah. Oh we've seen that before too. Especially we've done some foreign divorces-

Todd Orston:                   That's right.

Leh Meriwether:             Where it's not uncommon to send money back to their home country to support their family. So they'll look ... on the surface it may look nefarious, well there's a wire transfer offshore. Well no they've been doing that throughout the course of their whole marriage and this is perfectly normal in this culture. So you've got to ask questions. When you get confronted with this, rather than being surprised and thinking the worst case scenario first. And it may be the worst case scenario, but start asking questions before you allow something to blow up more than it is.

                                         Because I've seen situations where we turn over bank records during the course of the case and all of a sudden, we get this call, this angry call or angry letter, where'd all this money go, where'd this go, and he just pulled this money out for ... he pulled 20,000 dollars out of his 401k and didn't tell her and got a loan, well he says, "No, no. That was to pay for our pool, remember? It wasn't free." But because she wasn't paying attention to the finances, she didn't know.

Todd Orston:                   Yeah. Really if there's a takeaway, and there should be a takeaway here, the takeaway should be just be aware.

Leh Meriwether:             Right.

Todd Orston:                   And this is not a comment, if you're in a healthy relationship, this is not a comment saying you should be distrustful.

Leh Meriwether:             Right. Yeah.

Todd Orston:                   That you should not believe what your spouse is saying. But my bottom line, all right, is that, ask questions. Okay? You have every right to look at the bank accounts. You have every right to see where the money is going and to ask questions about how it's being used. If you don't ask questions you can't be surprised when you're surprised.

Leh Meriwether:             Right.

Todd Orston:                   You like what I did there? Okay.

Leh Meriwether:             No.

Todd Orston:                   Too late. Yeah. So just ask questions. That way, hopefully, you're gonna avoid the big negative surprise that may come if you ever have to go down this path.

Leh Meriwether:             Yeah. And I had something, I had this brilliant thought.

Todd Orston:                   I've got to tell you, you've moved me with that last comment. Your brilliance is blinding. No. Just understand what we don't like, like I said before is joking, but not, is we don't like surprises. Attorneys, in the context of a divorce case, don't like surprises.

Leh Meriwether:             Right.

Todd Orston:                   What we really also don't like is watching when our clients are surprised because they didn't ask the right questions.

Leh Meriwether:             Yeah. Or come back to where did all the money go 'cause we've had that happen before too where well gosh over the course of the marriage, he earned this much money, how is it we only have this much in the 401k.

Todd Orston:                   Sometimes it's to the tune of hundreds of thousands of dollars.

Leh Meriwether:             And you go through and you break down the bank accounts and you see wow, y'all just spent it. So that happens. But maybe you go through it, we've seen this happen too, where the wife thought everything was fine and then all of a sudden she looks and she sees that wait a minute, we should've had 100 grand in this account, why is it down to 30,000 dollars and we do some investigation perhaps some forensic accounting and lo and behold there is this thing out there and-

Todd Orston:                   There's another thing out there. We're out of time.

Leh Meriwether:             Yeah. Up next we're gonna get into more situations, surprises, financial surprises that we see women commonly experience in a divorce.

                                         Welcome everyone. I'm Leh Meriwether and with me is Todd Orston. Todd and I are partners at the law firm of Meriwether & Tharp and you are listening to Meriwether & Tharp radio on the new Talk 106.7. If you want to learn more about us, you can always check us out online atlantadivorceteam.com.

                                         Well today we've been talking about ... we are talking about financial surprises that women often experience in divorce. In the last segment we talked about marital spending. You know, often they're surprised when they sit own and look at the finances, they're like, "Wow, where did all the money go." Well on the flip side of that, Todd likes to call, wait we owe how much?

Todd Orston:                   That's not what I like to say. That's what many of our clients have said. But yeah, unaware of marital debt. And it's similar, right?

Leh Meriwether:             Yeah.

Todd Orston:                   And the biggest similarity and the biggest, well similarity between the two the first segment and this is if you are not doing what it takes to be aware of what the finances look like, you may not know the money that's being spent, you also may not be aware that there is overspending going on. And we have had clients where we start down this path and all of a sudden, it's like they're like, "Well, I have this one credit card. It's got a thousand dollar balance." Oh okay, but are you aware of the 60 or 70,000 dollars of other debt? And it's like head explode time.

Leh Meriwether:             Right.

Todd Orston:                   They just weren't aware. They weren't aware that the other spouse was doing these things. I had one case where my client had some premarital credit cards.

Leh Meriwether:             Right.

Todd Orston:                   Rubber banded sitting in a drawer. He didn't use them, for whatever reason the credit card companies didn't cancel them. And we get into the divorce and it turns out that the wife not only did she file bankruptcy once, but she filed bankruptcy two times-

Leh Meriwether:             Right.

Todd Orston:                   Without him knowing. And she found these credit cards after her bankruptcy. Changed the mailing address to a PO box and started spending on these credit cards. So we get into the divorce and she ran up cards.

Leh Meriwether:             Right.

Todd Orston:                   And she, not they, bankrupted. Did it again, and then found these other cards in his name, ran those up.

Leh Meriwether:             Oh wow.

Todd Orston:                   And he's sitting there going how do I not have to file bankruptcy. How do I ... I can't pay you. And it was a significant amount of money. You have to be aware of the debt.

Leh Meriwether:             Yeah. And that can include mortgages. We've had situations where we're in the middle of mediation and we're trying to settle the case. The other side, I represent the husband in this one, but the wife was like, "Why is our mortgage so high? This doesn't make any sense to me. Oh you must have gotten out a HELOC without giving me notice." What? Actually while we were in the mediation, I had access to the internet, put one the database, the public database. Pulled up the HELOC and found her signature over all the documents. Printed them in the mediation and handed them to her and say, "You signed off on all this stuff. So I'm not sure ... you may not remember it, but here it is and here's a notary here, so we can always call the notary."

                                         So anyways, it helped facilitate settlement, but in that situation she was surprised when she saw the raw number for how much they owned, the mortgage they owned on their house. But she completely forgot they had taken out a home equity line. They'd done some renovation on the house. She just wasn't paying attention in that case. So it's important to become aware of the marital debt so you're not surprised. And maybe sometimes if you haven't been paying attention, and I'm not trying to come down on people that haven't been paying attention, but try not to be surprised. Just okay, I wasn't paying attention. Let's figure this out now.

Todd Orston:                   Well try not to go into shock.

Leh Meriwether:             Yeah.

Todd Orston:                   You're gonna be surprised, but it can't be debilitating. It can't affect your ability to move forward and protect yourself and gather the other information you need to defend yourself.

Leh Meriwether:             Yeah.

Todd Orston:                   And to present your own case.

Leh Meriwether:             So most of the time, in a healthy relationship, you often see the husband and the wife sitting down at least maybe once a quarter or at least once a year having a budgetary meeting talk about where they are. The other thing, when we practice, we do marital balance sheets. You have to do a domestic relation's financial affidavit, so you're supposed to add up all your debt. A lot of times people haven't, especially women haven't done that. They haven't sat down and added up all their debts. When they see that big number, it can be surprising.

Todd Orston:                   Well, many of my clients like yours, it's because they've never had to.

Leh Meriwether:             Right.

Todd Orston:                   And you said this earlier.

Leh Meriwether:             Yeah.

Todd Orston:                   It's because-

Leh Meriwether:             Those are the roles that they were playing.

Todd Orston:                   Yeah.

Leh Meriwether:             It's not that ... and I definitely don't want to say that women don't pay attention.

Todd Orston:                   No you're not. No. In my family, my wife handles a lot of the day to day financial issues.

Leh Meriwether:             Yeah.

Todd Orston:                   Okay? And she balances that with taking care of the kids and working and doing all the other things she does. But the bottom line is there are aspects of our finances I know I am not 100% up to date on. You know, I don't ask her these things because I trust her. But you know what? If God forbid, I found myself in this position going through a divorce, I would be scratching my head and if something sort of came up that I wasn't aware of and it surprised me, I would have to look at myself and go well shame on you for not asking the questions.

Leh Meriwether:             Right. Yeah.

Todd Orston:                   But the point is, in my situation I'm the guy who doesn't have his finger on the pulse of our family finances. But we see it so often with women who are taking care of the kids, taking care of the home, working, doing all these other things. And the husband is like, "I've got it covered."

Leh Meriwether:             Yeah.

Todd Orston:                   You know, and it's fine. I understand why. But we also see the divorces. We see when they come in and then we have to dig in and it's mortgages, credit card debt, tax debt.

Leh Meriwether:             401k loans.

Todd Orston:                   401k loans. Student loans. Student loans, it's usually not a surprise because it's hard to go through a school program.

Leh Meriwether:             Right. But there's usually a surprise because so many people just make the minimal payments.

Todd Orston:                   That's right.

Leh Meriwether:             They're like, "Wait a minute. We only paid in the last 15 years I only paid down 5,000 dollars on it."

Todd Orston:                   Right.

Leh Meriwether:             Well yeah.

Todd Orston:                   Personal loans, family, friends. Going and doing car title loans, things like that. Or how about employer loans?

Leh Meriwether:             Yeah.

Todd Orston:                   We've had situations, I've had situations where somebody works for a company and they have several times gone to the company and they've basically taken a loan against a 401k. Or they've said, "Hey can you advance me some money?"

Leh Meriwether:             Right.

Todd Orston:                   It's oh yeah, by the way we owe 5,000 dollars to my employer.

Leh Meriwether:             Yeah.

Todd Orston:                   So you have to ask the questions and you know what? Sometimes it's common sense.

Leh Meriwether:             Right.

Todd Orston:                   And by that I mean, if you know generally how much and let's say you're not working, and you know generally what your spouse earns, and he pulls up in his new corvette and says next month's vacation is gonna be stellar. I'm taking everybody to wherever. And you're scratching your head going where is this money coming from.

Leh Meriwether:             Yeah.

Todd Orston:                   Then you may need to ask some questions.

Leh Meriwether:             Right.

Todd Orston:                   So you don't experience this surprise.

Leh Meriwether:             Yeah. All right. So another surprise that a lot have is reentry into the workforce.

Todd Orston:                   Comes up all the time.

Leh Meriwether:             Yeah. Especially if you have a situation where the husband and wife entered an agreement basically that okay the wife is gonna stay home and raise the children. The husband provides financially for the household and now all of a sudden, it doesn't matter who wants a divorce, the issue of hey look alimony is not gonna be forever. Well at least you're in Georgia. There are some states like Florida that have permanent alimony. After so many years of marriage there's permanent alimony. But a lot of times those alimony rewards, they reduce over the course of time. Because there's an expectation that the wife is going to reenter the workforce.

Todd Orston:                   Yeah. But keep in mind, that's a permanent aware. That has to do with duration. The permanency-

Leh Meriwether:             Right.

Todd Orston:                   Has to do with duration. What a lot of people get surprised about is well I haven't worked in 10 years. I have been and am now dependent upon my spouse for my support.

Leh Meriwether:             Right.

Todd Orston:                   They will continue to support me. What they don't understand sometimes is that the income of the spouse, while you were living under the same roof, sharing expenses may have been sufficient to provide for you.

Leh Meriwether:             Right.

Todd Orston:                   So that you don't have to work. When you are now living in separate homes, separate mortgage or rent payments, car payments, this payment, that payment, that same salary may not be enough and oftentimes is not enough to make is to that you don't have to work.

Leh Meriwether:             Right. To cover two separate households.

Todd Orston:                   That's right.

Leh Meriwether:             Because you're in a sense, your living expenses are doubling. Because there's gonna have to be a home for your spouse who also needs room for the children, if you have children, to come visit him or her.

Todd Orston:                   Yes. Let's be clear the judge will allow him to live in a home. All right? However bad he was, he gets to live under a roof. So yeah. That's where a lot of the surprise comes up.

Leh Meriwether:             Right.

Todd Orston:                   And I think we're gonna have to go into a break and we'll talk about this a little bit more after the break, but the surprise not just is that I'm gonna have to get a job, it's a lot of times how quickly. Okay?

Leh Meriwether:             Right.

Todd Orston:                   Because they're like, you know a lot of people are like, "Do I have six months? A year? Couple of years? Then fine I'll go out and I'll start working again." And a lot of times, the budget, the family budget isn't enough.

Leh Meriwether:             Right. So up next we're gonna continue to dive into the financial surprises that we see divorcing women experience.

                                         Welcome everyone. I'm Leh Meriwether and with me is Todd Orston. Todd and I are partners at the law firm of Meriwether & Tharp and you are listening to Meriwether & Tharp radio on the new Talk 106.7. If you want to learn more about us, you can always check us out online atlantadivorceteam.com.

                                         Today we're talking about what we see most commonly, the surprises, at least the financial surprises that we see women experience going through a divorce. We're speaking in generalities. We're grouping things together, this is not something that applies to everyone. But we did think it was important to talk about because if someone's considering going through a divorce, or the D word's been discussed. They should ... listening to this will prompt them to ask questions about what about our finances, how much money have we made, where is our money going, what are our debts, and get on top of everything.

                                         Obviously we would hope that during the course of the marriage once a month, once a quarter, once a year the husband and wife are sitting down and working on a budget, working on a net worth statement. Those are signs of a healthy marriage. But sometimes that doesn't happen. Not that the marriage is unhealthy, but the husband and wife enter roles where the wife is the ... takes care of the children and the husband is the breadwinner. So it's perfectly normal. I want to make clear when we bring these up, it's not like we're bashing on women or anything. So-

Todd Orston:                   That is a look of contempt right there. Of course. Of course. It's a reality.

Leh Meriwether:             Right.

Todd Orston:                   And the reality anyone listening knows that like I was saying before, in my family it's a different dynamic.

Leh Meriwether:             Right.

Todd Orston:                   Right. Growing up, for the most part my mom did not work at a job. She was a typical stay at home mom who worked her you know what off-

Leh Meriwether:             Right.

Todd Orston:                   Taking care of the kids and making sure the house was taken care of and all of that. And probably worked three times as hard as my dad who was at a job.

Leh Meriwether:             Yeah.

Todd Orston:                   Sorry dad. But the point is that so many of these decisions carry potential consequences. And a consequences could just simply be you are not getting the information you need to be kept apprised of what's going on in the family financially. You're deferring all of that to the spouse.

Leh Meriwether:             Right.

Todd Orston:                   And that's fine. Okay. But if the D word has been used, and or if you are about to go down that path.

Leh Meriwether:             Right.

Todd Orston:                   You can't be surprised. Because you know you haven't asked the questions, you know you haven't dug in to educate yourself about your finances. And what we're trying to do with this show is say educate yourself.

Leh Meriwether:             Exactly. So we left off talking about one of the surprises is when often people, women will come expecting to be taken care of financially speaking. Well the kids, it's six, seven more years before they go off to college. Doesn't he have to pay for me to ... can't we keep this arrangement. And there's situations where there's just not enough income to go around to make that happen. And your household expenses have suddenly doubled because you have two separate households. And now you have to actually go out and get a job. And because he has enough money to pay child support, but not enough money to pay alimony on top of that. So it is just mathematics. It's just finances.

                                         Sometimes we get the question, should I get a job during the divorce? Is that gonna eliminate my alimony? That sort of thing. Or should I wait till afterwards? Well the problem is if you wait till after the divorce and you get the job afterwards, he can always come back to court to modify his alimony because he can argue that your need is suddenly changed because now you have an income.

Todd Orston:                   Yeah. We're gonna go into this a little bit more. When you start looking at your budget, you realize how expensive living is. It's not give me 1,000 dollars and I can survive.

Leh Meriwether:             Right.

Todd Orston:                   Sometimes people are surprised by their budgets and they put together their budget and they're like, "Wow, I guess I need 5 or 6,000 dollars to survive."

Leh Meriwether:             Right.

Todd Orston:                   Now if your spouse makes 100,000 dollars. That's a great sizable income. But that's 8300 dollars per month.

Leh Meriwether:             That's before taxes.

Todd Orston:                   And that's before taxes. So now you net that out. And you take the taxes out. Let's just use some round numbers. Now you're about about 6000, 6500. Okay. And you need 5000 to live. Well you're not gonna get 5000 dollars and your husband has 1000 dollars to survive.

Leh Meriwether:             Yeah.

Todd Orston:                   That means you're going to have a budget shortfall. So then the question then becomes do I need to go out and get a job? Well no. You don't need to. Should you? Absolutely. If you want food. And water.

Leh Meriwether:             Yeah.

Todd Orston:                   Some of those things. Then yeah, you do unfortunately have to start thinking long and hard about going out and getting a job.

Leh Meriwether:             I think you've just hit number four.

Todd Orston:                   Yeah.

Leh Meriwether:             Without even knowing it, the incorrect assumptions regarding alimony and child support amounts. And the duration of them as well.

Todd Orston:                   Oh I realize I did.

Leh Meriwether:             You just didn't telegraph it.

Todd Orston:                   All right. All right. Maybe I didn't realize it. But whatever. So yeah. Assumptions about alimony and child support.

Leh Meriwether:             Right. And so it's I guess the surprise should not be a surprise talking about the first two like unaware of the money situation, the inflow of cash, and the outflow and what their debt situation is. Well it should be no surprise that we don't have an understanding what the budget's gonna be after the divorce and whether there's enough money to go around. So often there's incorrect assumptions about the budget. And even, gosh that's not just a surprise for women, we see this with couples in general.

                                         Both sides are surprised by how much they're spending. When they're forced in a divorce setting to sit down and add up their net worth because you have to do that when you're dividing up the assets through equitable division here in Georgia. It's gonna present itself. And people often go, "Wow, that's all I've said over these years." Because they weren't paying attention.

Todd Orston:                   Yeah. With alimony very quickly we've done shows on this, but alimony it's need based.

Leh Meriwether:             Right.

Todd Orston:                   So it's need versus ability to pay. Those are the two primary factors. Do you have a need? I.e. is there a budget shortfall? Do you make enough to cover all of your expenses? If not there's a shortfall. You have a need.

Leh Meriwether:             Yeah.

Todd Orston:                   But then it doesn't stop there. You have to look at the other party. Do they have an ability to pay? Once again if you have 100,000 dollars income, meaning the husband does. And you net that out and after everything it's 6000 dollars. It would be probably a little more than that, but let's say it's 6000 dollars and on top of that, there's a child support obligation of 1200 dollars that the husband is paying, well you're not gonna be able to get 3, 4000 dollars of alimony because the ability to pay just isn't there.

Leh Meriwether:             And I want to add this last thing because another thing that people don't take into consideration is we've seen this happen before where we've had a client, got a great alimony award for, we strongly encourage her to get a job, get completely independent of him, and just put that money in the bank for a rainy day. Maybe save it for college 'cause there were some concerns about him. He made great money, but he was suffering from alcoholism. Well, we get the divorce, a year later, a year goes by, she does get a job. And she's starting to be able to support herself and then he commits suicide.

                                         So he had gotten a life insurance policy, but the problem was there was this two year exclusion. So if you commit suicide within two years of getting your life insurance policy, they won't cover you. So now all of a sudden she's got no child support, no alimony, and thankfully she did go out and get a job. I think it was a part time job at first, but that gave her experience on her resume that allowed her to get a full time job to make up that difference 'cause suddenly she didn't have that income.

                                         And yeah. She could bring an action against his estate and probate court, but gosh that can take a long time. When we had Eric Broel on this show, a probate litigation attorney talking about the process can take a long time. So there's a practical aspect of thinking about taking care of yourself after a divorce.

Todd Orston:                   And very quickly, there are some strategic decisions that obviously go into whether or not you should ... or at some point in time, or what point in time, you should go out and get a job. Because people will come in and we'll have a woman sit across, "Should I start looking now? Should I start looking in six months? If I look now, will that impact the kind of alimony that I might get? Therefore should I get the alimony aware and then start looking?" All very reasonable logical things that need to be thought about and considered when talking about this kind of strategy.

                                         But here's the thing. Here's my take. My take is even if you wait, so let's say you wait, you go through the court process, your need is higher because you don't have a job, don't have income, you get an award of alimony. You then get divorced. If you then go get a job, it does open the door to a modification. So no matter what, it is possible to have the other party revisit that issue with the court.

Leh Meriwether:             Yeah.

Todd Orston:                   So I typically tell people, "Look, unless this is a situation where the alimony and support is going to be so sizable that easily you'll be able to survive just on that support, then you need to be thinking about sooner rather than later getting back out there, getting into the workforce. Because a lot of times the amount that you'll receive from earnings is greater than the alimony that you might be able to get from your spouse now that you have the separate budgets and you're living separately."

Leh Meriwether:             Yeah. Well hey, up next we're gonna get into the surprise, other surprises including surprises surrounding the marital home, surprises concerning insurance, and surprises concerning the costs of divorce.

                                         Todd, while we're on a break, let's take a moment to speak just with our podcast listeners.

Todd Orston:                   Great idea, Leh. First, thank you for listening. If you're a client of ours, thanks for taking the time to educate yourself. It really helps us help you.

Leh Meriwether:             I wanted to thank those who recently took a moment to review our podcast. We really appreciate it. If you feel like you're gaining a value from this show, please take a moment to post a review. The reviews help others find the show, which allows us to help even more people.

Todd Orston:                   And if you're not sure how to post a review, our web masters put together a simple explanation on our webpage. You can find it at mtlawoffice.com/reviewit. That's M as in Mary, T as in Tom, lawoffice.com/reviewit.

Leh Meriwether:             Welcome everyone. I'm Leh Meriwether and with me is Todd Orston. Todd and I are partners at the law firm of Meriwether & Tharp and you are listening to Meriwether & Tharp radio on the new Talk 106.7. If you want to read more about us, you can always check us out online atlantadivorceteam.com.

                                         Well today we're talking about the financial surprises that we often see divorcing women experience and we're talking in generalities here and stereotyping, but the stereotype comes from what we see most commonly. Obviously there's exceptions to what we're talking about and Todd you've even given some examples how you weren't paying attention, not you weren't, but your wife handles the finances in your relationship. So there's exceptions, but we're talking in generalities. But we have three more to hit.

Todd Orston:                   Yep.

Leh Meriwether:             And one segment left.

Todd Orston:                   So stop talking.

Leh Meriwether:             All right. The marital home.

Todd Orston:                   Yep.

Leh Meriwether:             So that becomes a big surprise.

Todd Orston:                   But otherwise known as, "But it's my home, I want to stay in my home."

Leh Meriwether:             Right.

Todd Orston:                   I get it. I understand. Going back to what we've been building on and talking about. Budget wise it may not be possible, okay. And you can't be surprise, or shouldn't be surprise. Again if you are both living on a certain amount of income and you know you have a 3000 dollar mortgage, well all you have to do is crunch some basic numbers and you might be able to say to yourself and understand, "Well, it's not possible for me to stay in the home. I'm probably not gonna be able to afford it myself. And my spouse may not be able to give me enough income to help me pay the mortgage on the house."

Leh Meriwether:             It's not just the mortgage. We often see two motivating factors.

Todd Orston:                   Exactly.

Leh Meriwether:             There's the children. The kids are already going through enough with the divorce, I don't want to add to it that we're moving, or we're gonna be in a different school district. I want to stay in this school district. Those are all really valid concerns. We're not trying to dismiss any of them. But you've got to pull back for a second because the last thing you want is to suddenly become house poor. So okay, we keep the kids here but I have so little money that we can't do anything, we can't go on vacations, we can't go out to eat. 'Cause we've seen that. All your money goes to not just pay the mortgage, but pay the utilities. Especially if it's a large home because we've seen that before too where there was a large home-

Todd Orston:                   Yep.

Leh Meriwether:             And the utilities were so big, so much, it was a 6000 square foot or more home that it didn't make sense for just three people to be in such a large home, especially since they're not operating as a family and entertaining anymore.

Todd Orston:                   Yeah. I've seen situations where the opposing party adamant I want to keep the house, can you afford it, don't think you can afford it. Yes I can. Yes I will. Fine. They end up taking the house, transferring to their own name, and six months later I'm hearing that there are foreclosure proceedings beginning.

Leh Meriwether:             Yeah.

Todd Orston:                   Because they haven't been able to make the payments. So a lot of times when you're working with an attorney, we will work with our clients and the budgets we create, we'll look. We are not financial experts in terms of financial planning and budget analysis in regards to advise you how to live your life. But when we put those documents together, sometimes it's very apparent.

Leh Meriwether:             Yeah.

Todd Orston:                   And we're looking at our client going you really shouldn't do this.

Leh Meriwether:             You know, and then sometimes it depends on where they are in their life, what season of life they're in. Because we've seen some ... I've unfortunately seen some 40 year marriages that ended in divorce. So you have the housewife and she's taken care of everything all these years, and now he wants to move on, right or wrong. It's the decision that's been made. So she wants to keep the house 'cause that's gonna be some level of normalcy. But he mowed the lawn, he did the things around the house, that may not be a good idea for her. So sometimes we just ask questions.

                                         What is it you really want to do, on the go [inaudible], do you want to take care of this lawn? No. I'd have to hire somebody to care for the lawn. Well how much will that cost? We start doing that math and next thing you know, really the wiser decision to make is to sell that home, pull as much equity out of the home, and then try to buy maybe a town home or a condo in cash. So as you get later in life and he retires and suddenly there is no alimony because he's retiring. But your costs are low because you don't have a mortgage payment.

Todd Orston:                   Yeah. And even if you do your budget analysis, and you look and you're like, "I think I can do this." But you're gonna be cutting it close, then what happens the first time you have to repaint your house.

Leh Meriwether:             Or the A/C breaks.

Todd Orston:                   Or the A/C breaks and you don't have insurance to fix it. All right. A paint job, 3500, 4000 dollars depending on the house. A/C goes out, you may be out hundreds or even thousands of dollars. And we've seen that also happen where people are like, "I think I can do this." But then-

Leh Meriwether:             There's no emergency fund.

Todd Orston:                   The stars don't align and this happens, this breaks, and this needs to be replaced. And all of a sudden they're like, "I can't do this."

Leh Meriwether:             And do I hear when you think you're gonna be able to squeak it by, that's just when fate hits you.

Todd Orston:                   That's right. Murphy's law.

Leh Meriwether:             Uncle Murphy moves in. That's what I was trying to remember. So insurance, you touched on that.

Todd Orston:                   Yep.

Leh Meriwether:             Health insurance in particular because this is something that even with a couple that is meeting and talking about budgets, they often don't think about what are the insurance costs because now all of a sudden the wife is gonna be on her own and once you ... now we see exceptions to this, but for the most part, every insurance policy I've ever seen, except for maybe one from another country, when there's a divorce, that's a qualifying event where the husband or the wife, depends, can no longer maintain the spouse on their insurance policy. So she has to break off. Now there's what's called COBRA. She can get that, but usually COBRA is ...

Todd Orston:                   Very expensive.

Leh Meriwether:             It's just too expensive. So she's got to get her own health insurance and dental insurance. So that insurance cost is often a big surprise.

Todd Orston:                   Again going back to the budget, we see this all the time where we sit down and we look, we put together a budget. And we often times we'll see a lot of surprise, meaning our clients are looking at the number that we put in front of them and I've had people look at me and go, "That can't be right."

Leh Meriwether:             Right.

Todd Orston:                   And it's like, look, this is based on the information you gave me. This is your car. This is your home. This is the lawn care and the cell phone and the house phone and the cable TV, and the duh duh duh duh duh duh duh. And here's the number.

Leh Meriwether:             Yeah.

Todd Orston:                   And that's the problem. Even the people who pay the bills sometimes aren't actually in tune with how much money it actually is. There are situations where I've represented the people who on the daily basis, and a monthly basis, are the ones who were writing the checks, paying the bills, but they've never looked at a comprehensive budget.

Leh Meriwether:             Right.

Todd Orston:                   And to them, it's just writing a check, writing a check. Or today another check, another check. But now all of a sudden, it's on one piece of paper and it's like, this is what your budget is like, wow. Now I know where all my money was going.

Leh Meriwether:             Yeah. So insurance, whether it's health insurance, sometimes it's auto insurance 'cause now you're splitting up and perhaps there was a multi-car discount. Now all of a sudden the wife who may have had ... or maybe the wife takes some teenage children onto her insurance. So those become big surprises. And those are things that need to be negotiated too. Because you need to take those into consideration when it comes to an award of alimony.

Todd Orston:                   That's why my kids are gonna horse and buggy. I mean, it's-

Leh Meriwether:             They're just gonna walk.

Todd Orston:                   I hope they're not listening.

Leh Meriwether:             Segway.

Todd Orston:                   There's some frantic kids right now like, "No."

Leh Meriwether:             They can ride a Segway to school.

Todd Orston:                   A Segway, yeah.

Leh Meriwether:             Probably cheaper than insurance.

Todd Orston:                   I'm gonna let you tell my kids that. We'll see how that goes.

Leh Meriwether:             I will. I'll tell them that's what your dad said.

Todd Orston:                   All right. Finally underestimating the cost of divorce.

Leh Meriwether:             Yes.

Todd Orston:                   And I know that's what we do. And sometimes when we broach this subject and talk about it, it's a little uncomfortable for us because it is expensive.

Leh Meriwether:             Yeah. Especially if you don't ... if part of what we're having to do is help our clients go through this ... untangle this financial mess and figure out what's really going on. The less you're aware of the finances, the more that part costs.

Todd Orston:                   Yeah. And the way that we handle it, I would like to think we are different, but I'm sure there are other attorneys out there that handle it similarly. We don't like surprises, so we will sit down with someone at the very beginning and explain, "Look, this is what you're looking at-

Leh Meriwether:             Yeah.

Todd Orston:                   And if things go very smoothly, if we can work things out, this is what the costs might be. If we have to go down the litigation path, this is what it might be. We may have this expense or that expense, this is what the minimum amount might be, this is what a maximum amount might be." But the bottom line is, and I say this to people on the phone all the time, you called an attorney. You knew when you called it's gonna cost you money. The surprise is really in how much. Okay? And different attorneys, even ones like us, where we are very efficient in what we do, okay, it's still a lot of money.

Leh Meriwether:             Still a lot of money. And you've got to keep your lawyer current.

Todd Orston:                   That's right.

Leh Meriwether:             We're not banks. We can't loan the money. So that's a big surprise sometimes. Well I've got to keep this current, yes there are situations where we can go to the opposing side and ask that they be responsible for some of the attorneys fees, but sometimes that doesn't happen right away. And it's very specific. Each county is a little bit different. Each judge is a little bit different. How they handle that. And obviously each state is different. There's different laws in each state. In Georgia there's a law that allows you to go for attorneys fees, but that about wraps up this show.

                                         Man, that went by so fast. Hey thanks so much for listening. We really appreciate it. And if you're enjoying the show, definitely go out and give us a review. We would love it. If you missed the show, or you were listening to it in your car and you wanted to go back or share it with someone, you can find us in most podcast directories, on iTunes, and we're even on YouTube. Youtube.com/atlantadivorcelawyer. You can find it on our website as well, mtlawoffice.com/podcast. Thanks so much for listening.

Speaker 3:                        This audio program does not establish an attorney client relationship with Meriwether & Tharp.