Episode 82 - What is a Certified Divorce Financial Analyst and How Can They Help You?
In recent years, more professionals have come on the scene to help people work through the painful divorce process. Certified Divorce Financial Analysts are a relatively new example of this. In this episode, Leh and Todd interview Beau Varnadoe, a Certified Divorce Financial Analyst (CDFA). Beau explains how he and others like him work with you and your attorney to get a better handle on your financial situation and sometimes even save you money. He breaks down when to hire a CDFA, how they can help, and in which cases they can be the most helpful. If you are someone who struggles to find the time to get a handle of your finances or have trouble fully understanding your current and future financial situation, you will definitely want to listen to this show.
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're listening to Meriwether & Tharp Radio on The New Talk 106.7.
Leh Meriwether: Here you'll learn about divorce, family law, tips on how to save your marriage if it's in the middle of crisis, and from time-to-time even tips on how to take your marriage to the next level. If you want to learn more about us you can always call or visit us online at atlantadivorceteam.com.
Leh Meriwether: You know, Todd, I'm going to do something a little bit different. I'm going to make a quick announcement because we're all about helping people on the show, and regardless of the source, as long as we know it's a good source, I know that Woodstock City Church is doing something. I don't think it's a faith thing. It's just they're providing the location. It's coming up this August. Monday, August 6th, and it's called Co-Parent Unscripted. And so, the information that they've given to me is that there's no script for handling all the challenges that a single and step-parents face, but there is a guide.
Leh Meriwether: They have an author, her name is Tammy Daughtry, she's gonna be presenting her book, Co-Parenting Works! The night's designed to offer insight for parents who are raising children between two homes, and to help you discover how to implement effective strategies to co-parent for co-parenting communication, coping skills, and more. It's this Monday from 7:00 to 9:00 in the evening. It's only five dollars a person, and you can register for it at woodstockcity.org. Again, woodstockcity.org, and then you go to the adult section, and there's a thing called Short-Term Groups, and you'll see it right on their website, and that'll take you right to where you need to register. I just wanted to give that announcement 'cause anything we can do to help, as strange as this may sound, help our clients not be repeat clients, we want to do that.
Todd Orston: Yeah, a good portion of our shows are trying to keep people away from divorce or away from having to come back to court if they've already gone through a divorce. So no, I think it's a great opportunity. I will say this. Parenting is difficult. Co-parenting is even more difficult because it has those additional challenges.
Todd Orston: And so, anytime you can find a good program that is really just there to help, really there to just offer some advice and some tips on how to make it work, take advantage of it. This is just one of those examples. I mean there aren't many, but this is one of those examples where it's just a great program at a great price. I think it's a great idea.
Leh Meriwether: And speaking of people that can help you get through your divorce and keep you from maybe even filing for bankruptcy-
Todd Orston: Nicely done. Wow. That was smooth.
Leh Meriwether: I've been working on it.
Todd Orston: [inaudible 00:02:48]. Right, exactly. For at least 30 seconds you've been working on it.
Leh Meriwether: Yes, for at least 30 seconds.
Todd Orston: All right. No, absolutely. Look, we try with our shows obviously, we try to educate, we try to bring a couple of laughs, but the bottom line is we are trying to educate, teach people, and help people, and this show is going to be no different. We've talked about this before. In a divorce, we talk about the four core areas of divorce, all right? Some of them are custodial in nature, some of them are financial in nature. This is going to be more financial in nature, and as smart as we think we are, okay? By the way, maybe we don't think we're that smart, but the bottom line is as smart as we think we are, often times we will look to experts and obtain assistance from experts who really know what they're talking about, really can dig a lot deeper, and offer the advice to us and to our clients that are needed. This show is going to focus on just one of those experts.
Leh Meriwether: And today with us we have Beau Varnadoe, the owner of ... I almost messed it up ... Beau Varnadoe. That's a great name. We're going to have to dig into that, where that name comes from. He's the owner of the Pegasus Group-
Todd Orston: That's the second show.
Leh Meriwether: That's the second show? Okay. The Pegasus Group Wealth Management. He's a financial advisor and a CDFA. He started off as an insurance agent in 2007, added financial advisory services in 2011, and got his designation as a CDFA in 2016. We're going to learn what that is, and how he can help you if you're going through a divorce.
Leh Meriwether: He was born in Augusta, grew up in Savannah and now lives in Woodstock, Georgia with his wife and daughter. His hobbies include long distance kayaking and woodworking. I like the woodworking.
Todd Orston: At the same time, that's what's really cool.
Leh Meriwether: At the same time, yeah. [crosstalk 00:04:39].
Todd Orston: I mean yeah, he's got this whole wood shop on a kayak.
Leh Meriwether: He has to use hand tools apparently, yeah. That's where he finds his driftwood. He's a member of the Georgia Veterans Association, is active in the American Legion. I could go on and on about Beau, but that would take up precious air time. You can learn more about him at [inaudible 00:05:00], or the Pegasus Group on Facebook. His broker-dealer is Money Concepts Capital Corporation located in Palm Beach Gardens, Florida. Beau, thanks so much for coming on the show.
Beau Varnadoe: Thank you for having me here.
Leh Meriwether: You knew I was going to mess up your name.
Beau Varnadoe: That's okay everybody does.
Todd Orston: What's great is how confident you are before we started. "Oh, I'm getting this right." I know I'm getting it right, and you just waffled.
Leh Meriwether: I'm going to have you introduce people next time.
Todd Orston: You folded like origami. It was terrible.
Leh Meriwether: Beau, thanks again for coming on the show. Tell everyone, what is a CDFA?
Beau Varnadoe: A CDFA is a certified divorce financial analyst.
Leh Meriwether: Now, is this something relatively new 'cause I don't remember seeing it 10 years ago, and it may have been around.
Beau Varnadoe: It is really new. It hasn't been around for very long and there's not very many CDFAs out there.
Leh Meriwether: How does one ...? You did financial advising, how did you go about becoming a CDFA?
Beau Varnadoe: Well, I took courses that were offered through IDFA, the Institute for Divorce Financial Analyst. But in order to do it I had to have three years in the business [inaudible 00:06:12]. I had to have it under my belt.
Leh Meriwether: As a financial advisor?
Beau Varnadoe: Yes, and I also had to be in good standing with the broker-dealer, and with the Securities and Exchange Commission.
Leh Meriwether: So you're governed by not just your broker-dealer but the state government?
Beau Varnadoe: By the SEC, the federal.
Leh Meriwether: Oh, the federal. [crosstalk 00:06:28].
Beau Varnadoe: And FINRA of course.
Leh Meriwether: Oh yes, FINRA.
Beau Varnadoe: And then, of course in order to keep the designation there's continuing ed just like y'all have.
Leh Meriwether: Yes, okay. And so, about how long is that course?
Beau Varnadoe: It's four courses. It's self-study, and you have one year to get it done.
Leh Meriwether: Okay, and then you get the designation. When's the best time to hire a CDFA? If you're getting ready to go for a divorce, at what point do you want to bring in one? I'm going to throw in a bunch of questions with this one, and let you answer it, but-
Beau Varnadoe: Go right ahead.
Leh Meriwether: Are there any limits, like does it have to be a high asset case? Or what kinds of cases do you bring the greatest value to?
Todd Orston: Before you start with that, what I would love for you to start with, define CDFA in your words. What I'd really like to understand is, I understand financial advisors, and I understand there are different people that ... and they do different things, and provide different services. If someone came to you and asked for that elevator pitch and said, "What do you do?" Just start if you don't mind, start with just tell me about, what you do, why it's different, and why it's valuable? That will go into, I think, and flow into those other questions.
Beau Varnadoe: Okay. Well your standard run-of-the-mill financial advisor is going to primarily focus on retirement and planning for retirement, which is a very long-run for most people, so it's very open-ended. Well, divorce is for a finite amount of time. Sometimes they're short, sometimes they go on way too long. And so, the CDFA focuses on that defined set of time, and that only, and all the intricacies that go with divorces, I'm sure y'all have seen in your cases, divorce is a beast all of its own. It has its own problems, and it needs its own solutions, and that's what a CDFA does.
Todd Orston: All right. So then going back to Leh's questions, what's the best kind of case for a CDFA to get involved in?
Beau Varnadoe: [inaudible 00:08:33] cases by their very nature are going to be very intricate when it comes to the finances. There's just a lot of moving parts. There's a lot of complicated parts. But even your standard divorce could use a CDFA. Just because a client has less money doesn't mean their money is any less important to them than your multi-millionaire. It's what they have. A lot of times especially, I'll say it, dealing with a woman who may have been a stay-at-home mom, she doesn't understand what goes into a 401(k), or a pension plan, or what are even stock options. And so, the financial advisor comes in, and make heads and tails out of that, shows her how to streamline, and how best to put together those finances to benefit her going forward from the divorce.
Todd Orston: So it's a real education, or there is a real education component being able to step in and talk to somebody. I mean obviously we deal with men and women who are not very savvy when it comes to certain financial things. And then, we've had stay-at-home mothers who have training and schooling but they've just elected to be a stay-at-home mom, and they have the knowledge. But the bottom line is you can step in and you can fill in gaps, you can educate so that when people are making decisions they're making educated decisions.
Beau Varnadoe: Exactly.
Leh Meriwether: Now I'm thinking about this, I've seen cases where the stay-at-home mom ran all the finances. She knew everything, and the guy, he just worked. The husband worked all the time, didn't know squat. He didn't know what his mortgage payment was.
Todd Orston: Yeah, didn't know what bank accounts were out there, and where the money goes once it's earned. [crosstalk 00:10:10].
Leh Meriwether: Yeah, right. How much everything was. You would even be able to help those husbands in those situations.
Beau Varnadoe: Oh, absolutely. I'm not gender preferential.
Leh Meriwether: No, but the example you gave is a very stereotypical example where we see where, and I'm not trying to be, I hate to stereotype, but I'm just telling what we've experienced. We experienced stay-at-home moms who were not involved in it either by choice or because the husband intentionally excluded them from the finances, and they're scared to death. They don't even know where to start. I mean that's a good example of cases that we encounter all the time.
Leh Meriwether: Hey, up next we're going to dive into how Beau gets into a divorce case, and get very specific about how he can help you get through the divorce process, and come out the other side in a much better position than if you tried it on your own.
Leh Meriwether: Welcome back 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're listening to Meriwether & Tharp Radio on The New Talk 106.7. If you want to learn more about us you can always call or visit us online at atlantadivorceteam.com.
Leh Meriwether: Well today we have in studio a CDFA, a certified divorce financial analyst. His name's Beau Varnadoe. Xanadu.
Beau Varnadoe: There you go, you got it.
Todd Orston: One more and I'm kicking you out for the remainder of the segments. I'm just telling you right now.
Leh Meriwether: No, next segment you're going to do the introductions.
Todd Orston: [inaudible 00:11:53].
Leh Meriwether: No, in all seriousness, we're talking about how this is a new group of experts. I'm not sure how to describe you Beau. If you have a better explanation or a description-
Beau Varnadoe: Oh no, you're doing fine.
Leh Meriwether: Okay. I'm messing up great. No, just kidding. No, but in all seriousness. Finances makes up three parts of the four core areas of a divorce. It comes into child support, alimony, and equitable division, so of the four, there's three of them that involve finances. This is relatively new. 10 years ago, I'm not sure I even heard of a CDFA, and now I'm seeing a lot more people with that designation. Even in your industry I think you told me once not many people are getting that designation.
Beau Varnadoe: No, there's not very many at all. My last firm that I was with when I had my annual review with my CEO and I told him what designation I was getting, he'd never even heard of it. He'd been in the industry for decades.
Leh Meriwether: Yeah. But it's pretty exciting because I think that you can help clients work through the financial aspects because your hourly rate tends to be, or the CDFA's hourly rate tend to be a lot less than lawyers and your focus is finances where our focus is legal. Although we have to be aware of the finances because we're the ones who have to argue about it in court, or at mediation. But you can come alongside clients and even in their houses I think, did you say sometimes you visit people's houses?
Beau Varnadoe: Oh yes, sit at the kitchen table. [crosstalk 00:13:24].
Leh Meriwether: You can come alongside of them, help work through it. I know I've got some specific questions for you.
Todd Orston: Absolutely. And going to the value, I'm excited hearing about this, and having learned about it, and now talking about it here because look, what we do is, a large portion of it is about education. I firmly believe, and I know Leh feels the same way, or at least I think so, that people can't make good decisions for themselves if they don't have good information to form the basis for those opinions, so it's so important to get educated because with that education you have power. You have the ability to make good decisions for yourself. And with the finances, yes, we do have to advise our clients. We talk about the finances. We give advice. But we can only go so far, and that's where you step in and people like you where you can really educate at a much deeper level.
Beau Varnadoe: Exactly.
Leh Meriwether: At what point during a divorce process should someone consult with a CDFA?
Beau Varnadoe: Oh, that answer is easy, as early as possible. Preferably before filing and separating because a lot of information has to be put together, and it's a lot easier to get that information when you're still together, and can get your hands on it rather than being out of the home and not able to get a hold of it.
Leh Meriwether: Yeah, 'cause then you've got to pay lawyers do what we call discovery, and get that information, and it costs sometimes a lot of money.
Beau Varnadoe: Exactly.
Todd Orston: Well, and that might be necessary anyway. I mean discovery happens in almost all the cases other than really uncontested where there's not a lot to deal with. But as we've talked about in shows before the discovery process could be very long, very drawn out, and very complicated. But with good education and good direction you could streamline it. And so, it's still a benefit no matter what.
Leh Meriwether: How do CDFAs provide litigation support for like a legal team?
Beau Varnadoe: Well as you said, you'll get into the finances but you only go so far. The CDFA can really dive into the financial aspects, put together a full financial analysis in order to arm the attorney to put together the best case for his or her client.
Todd Orston: Is it with an eye towards the future? In other words, if our client gets x then, in the context of a divorce then they're going to be fine, in other words, here's a 15 year, or 20 year, or 30, or whatever it might be, do you break it down? In other words, so it's like, "Look. This is what you need to maintain this kind of a budget, and to live this kind of lifestyle." Are you going to really hit it from those angles?
Beau Varnadoe: Exactly. And say, like if you have your client, what is that client's needs? I mean, does it do this client any good to split the 401(k) down the middle and give her or him a nice retirement account when he or she actually needs short-term income? They haven't worked in years. They have to get a job. They need something to live on. Where's the best place to pull assets and the division to best benefit this client?
Leh Meriwether: You're looking at things like with a 401(k) if you withdraw the money depending on the tax bracket you may lose 40% of the money that's in there. But perhaps if you got more of the marital home usually unless there's been some massive increase in income I mean a value which really hasn't happened since the Great Recession, but you're going to be looking at tax-free money from the marital residence.
Beau Varnadoe: Right.
Leh Meriwether: Okay. How can a CDFA assist with the financial analysis? Going just a little bit deeper. So, what is it in particular that you do?
Beau Varnadoe: I mean we look at things like the retirement plans, investment accounts, tax documents, that's a big part of it, business records. One of things that the attorneys always seem to like the best is the pension plans because in order to divide the pension you have to know what it's going to be worth years, decades down the road. A CDFA is trained in how to value a pension account in order to argue for now what it's going to be like in the future.
Leh Meriwether: Okay. You gather all these documents, and you make a deep dive into them, and sort of try to look at not just today but tomorrow?
Beau Varnadoe: Yes.
Todd Orston: Are there any specific tools that you use? I mean I know gathering information is incredibly important and you're going to work on that information gathering. But once you have information, are there specific tools in your trade, in your industry that you use that you could then basically provide to the client to help them better understand what's going on?
Beau Varnadoe: Sure. We use all kinds of software packages. Each CDFA will have his or her preferred package to do that. But yeah, it looks at the short-term as well as the long-term implications.
Leh Meriwether: Okay. I'm assuming you take into consideration the tax implications of certain forms of income and that sort of thing.
Beau Varnadoe: Most definitely.
Leh Meriwether: All right. Let's talk about maybe somebody who doesn't have, there's not a whole lot in the way of assets, but there's income and people need to support themselves when the divorce is over. Obviously, you're going from one household to two, so your cost for those people are doubling at least as it relates to household costs. How does a CDFA help gather financial data to help a party prepare a budget?
Beau Varnadoe: A lot of it comes from the financial affidavit. I'm sure y'all may have clients, and you give them the financial affidavit, and say, "We need this filled out." And they just glaze over. They have no clue or they're asking you questions. Well, a CDFA can help the client make heads and tails out of the financial affidavit, get a complete picture which makes the attorney's job easier, and gives them, like you said, a better picture of what they actually have that they may not have even known they even had before.
Leh Meriwether: You know I had a case, gosh it was about maybe three or four years ago, I wish I had known you back then. I couldn't even get my client to gather the information. She was having a hard time getting past the fact that she was going through a divorce period. And I said, "Okay. Can we change the way you're thinking about it? What would happen if he died yesterday? What would you do to figure out how to pay the mortgage? How to do this stuff?" I was trying to get her to think. And she said, "I don't know." I'm like, "Oh, my gosh." Thankfully her father stepped in, and went over to the house, and helped gather some of that information, but-
Todd Orston: There are very few people that go through the divorce process that want to be going through it, and dealing with these things in the divorce process, so there is often times a reluctance. Sometimes the reluctance is born out of, "I just don't even know where to start." Sometimes it's, "I just don't like the fact that I'm going through a divorce and now I have to think about these things." But you have to. And to your point before where it makes the attorney's job easier. Not only that, but it gives us a higher level of confidence that the information that's being used and put into the financial affidavit is going to be accurate because we do a lot to make sure the information is accurate but inaccurate information, we are trained as family law litigators, one of the things we do is we look at and potentially pick apart the financial affidavit to make sure there's no fluff, to make sure that the numbers are correct. And so you stepping in, you're going to avoid that at least on the other end, so we have higher level of confidence if we have to go to court.
Beau Varnadoe: That's exactly right.
Leh Meriwether: I've got another question for you. I'm throwing you a curve ball.
Beau Varnadoe: Go right ahead.
Leh Meriwether: I don't think we've even talked about this before. Have you ever provided litigation support to the lawyer you're working with? You and the lawyer share the same client where the lawyer says, "Hey, here's the financial affidavit from the opposing party. Is there anything that you would attack on this?" If you've been helping, let's say the wife.
Beau Varnadoe: Sure. If I've got access to the tax records, the tax returns, bank statements or anything, yeah, I can cross the numbers over to make sure they're lining up and the numbers are jiving. I'm sure everybody's completely honest on their affidavit. There's no ambiguous there.
Todd Orston: We'll talk to you during the break.
Beau Varnadoe: Okay.
Leh Meriwether: Well, that's really good. I learned something new today. I always learn something new when we bring in a guest.
Todd Orston: And during the break we'll work on the name. [crosstalk 00:22:03]. And try to learn that.
Leh Meriwether: We'll work on you doing the introduction. Hey, when we come back we're going to continue talking to Beau and how he can help you get through the divorce process.
Leh Meriwether: Welcome back everyone. I'm Leh Meriwether, and with me is Todd Orston, and with us is Beau Varnadoe. He is the owner-
Todd Orston: And the crowd goes wild.
Leh Meriwether: All I had to do was slow down. I just get so excited.
Beau Varnadoe: Thank you.
Leh Meriwether: That somebody's here and can teach me something new. But Beau is a certified divorce financial analyst and he also does financial advising. But we are today talking about his role in a divorce case and how he can help people work through the financial issues in a divorce to help them make wise decisions.
Leh Meriwether: Now I got a quick question, a little bit off subject, it's not divorce. But, do you ever help in modification cases where someone comes in says, "Well I need a modification of my child support or my alimony," have you ever had a case like that?
Beau Varnadoe: Sure. I haven't had one to date but I could. Yes. On the alimony, if the attorney needs some supporting facts and figures, and back up in crafting the new alimony then of course yes, I could be of assistance.
Leh Meriwether: Okay. So the same role when you're helping someone come up with an alimony award or a request, you can also sit down with someone and say, "Well if your alimony got reduced to this, this is what we'd have to do."
Beau Varnadoe: This would be the long-term implications, yes.
Leh Meriwether: Okay.
Todd Orston: Well, it goes to setting expectations, right? I mean and that's a big part of what we do is working with our clients, set expectations, explain to them the consequences of their actions, or the results, or what could occur because a case is filed and dealing with all these issues. But with us, setting expectations is one of the most important things that we do.
Leh Meriwether: Yeah. So Beau, I would imagine then what you do you are also helping working with client's expectations.
Beau Varnadoe: Absolutely. Like you said, you ever had that client that came in and they just knew in their head what they were entitled to, and you had a different solution?
Todd Orston: Just about every day. [crosstalk 00:24:42].
Leh Meriwether: I don't have those kind of clients.
Todd Orston: They come in, they're like, "I know nothing, and just teach me, just tell me what to expect." No, people have strong opinions and they'll come in, and sometimes those opinions are our spot on. Sometimes it's not nearly what they deserve, or they should expect, and sometimes it's well beyond what would be reasonable or what we think would be reasonable in the eyes of the court.
Todd Orston: But again, I mean I had one of those conversations today where someone called in, and they just had some misunderstandings about an existing order. Before I could even get to the current pain that she was experiencing I had to jump in and go, "Hold on. Let's talk about the existing order and what your expectations should be because I think what you're expecting is not realistic because maybe you're not understanding the terms." So, we have to set those expectations all the time.
Beau Varnadoe: A lot of it comes down to emotion. I mean studies have shown that almost all financial decisions are based on emotion in some form or fashion. Well when you add a divorce into the mix just crank the emotion all the way off the charts. Now you're dealing with anger, shock-
Todd Orston: A little more anger.
Beau Varnadoe: Yeah, exactly. Yeah, a little more anger on top of that. All of a sudden, you're having trouble seeing what is going on. I had another CDFA tell me recently that the primary reason people get divorced is financial in nature. And if you couldn't make good financial decisions when you were married you're certainly not going to make them when you're getting a divorce. And so, the CDFA helps calm the emotions down to say, "Okay. I see what you're saying, but here's the implications if you do that." To your point, they can make an informed decision.
Leh Meriwether: When you have that client that comes in and said, "Leh said for me to talk to you. I'm really mad about the numbers," how do you go about calming them down? How do you go about resetting their expectations?
Beau Varnadoe: Wow, that's a good question. First of all, I'm sure like y'all, we just let them talk it out. A lot of times that will bring it down. And then, I start looking at it rationally. "Okay, we can speculate on the what ifs, but if you go down this road this is what you can expect in the future. Is that really the outcome that you want?" And usually at that point, then they'll back off and go, "No. This is the outcome that I want." "Okay. Well now let's craft a solution that gets you to the outcome that you want."
Leh Meriwether: Okay. And so, what happens when they're like, "Well, this is the outcome I want," but there are no numbers to support that outcome?
Beau Varnadoe: I have to tell them that. And honestly, that's the primary reason why I lose a client is 'cause I don't tell them what they want to hear. I tell them what they need to hear.
Todd Orston: If I had a nickel for every time I said that to clients or to people that I speak with on the phone who are thinking about retaining or moving forward with some kind of a case. My job is not to tell you what you want to hear, it's what you need to hear. Sometimes that's painful. Sometimes you may not like what you hear. But I would rather give you that honest opinion so that you can make good decisions for yourself rather than just tell you something that I think you want to hear that isn't based in reality, and now I've totally missed the mark in terms of setting your expectations, and that can create real problems. Sometimes we give the good advice, and it's not heard, and I see those instances where it creates a lot of stress and a lot of problems. So, I agree with you. I mean I strive, like you, to just set the expectations at the beginning and give the best advice possible no matter what or how I think it's going to be taken.
Beau Varnadoe: Sure. In your divorces, how often have you heard, "I just want this to be over."?
Leh Meriwether: It's all the time.
Beau Varnadoe: Pretty much every case, exactly. People are willing to sign off to relieve the pain now not realizing what they're signing off on will deliver them long-term pain that will last for many, many years.
Leh Meriwether: Yes, I've seen that before. That's where that balancing act, and sometimes lawyers can accuse, "Well, you're just stirring the pot. You're just causing this case to take longer." But we're there to advise our clients, and we're very resolution focused at Meriwether & Tharp but at the same time we're there to protect our clients. So we've seen it where the clients just want to, "I just want out." And they're willing to sign something that we know that's going to wind them up in bankruptcy court in three months. We just can't advise them to sign that settlement agreement. In those situations, we often have them sign a document saying, "We advise you not to sign this agreement."
Beau Varnadoe: Smart thinking.
Leh Meriwether: Okay. Sometimes work with them at the kitchen table in their house. Do you ever go to the mediation itself to help manage those clients' expectations and work with the numbers at mediation?
Beau Varnadoe: Yes, on a couple of occasions I have to help. Generally, when they're relatively amicable, and there may be a few sticking points they can't just work out. I will come to the table to work with both parties to say, "Okay. Let's come to a resolution on this." And to analyze the finances on that. I'm sure y'all have seen this, it's funny that people often times the things that you think are going to be the most complicated they'll come to a ready decision on, and these little insignificant things that turn into [inaudible 00:30:22] slugfest.
Leh Meriwether: Yeah, we've definitely seen that before where we're like, "We didn't see that coming." Okay. Well, how about trials? Have you ever come to trials to help present evidence or anything like that?
Beau Varnadoe: With my designation I can actually serve as an expert witness. To date, I have not had to do that.
Todd Orston: Because you come in and you give such good information that it promotes early settlement.
Beau Varnadoe: Yes, let's go with that one, yes.
Leh Meriwether: Well no, but I do find that the more prepared you are for mediation, the more you're prepared period in the case, the more likely you're going to settle at mediation and avoid trial. Sometimes people are like, "Well, you're gearing up for trial." And we're like, "No, we're not. We're just gathering information so we can make a wise ... Give our clients some really good advice on whether they should settle or not."
Todd Orston: You don't go looking for the fight but you need to be prepared for the fight. And so, we tell our clients that the work that we are doing ahead of time is to avoid the fight. It's not to go and fight. And so, that hopefully if they step up and they say, "Well, my client wants ..." We can go, "Well hold on one second. Look at this. Look at this. Look at these calculations. This is why no way your client is going to get what you're asking for. Okay? Because we don't think that the judge would even think about that as an option." We go in armed with that information, what you're doing is you're arming the client, you're arming them with information also, and I think that's invaluable.
Leh Meriwether: Yeah. What do you find to be the most challenging part of being a CDFA?
Beau Varnadoe: Oh, that's also a good question. The challenging part I guess it goes back to the emotions is trying to defuse the situation, and get the emotion out of the way in order to get to the actual figures and numbers to compile it, and in the end help the client, and kind of explain that this anger is not going to help you. "I see where you want to go, but here let me show you the implications of that. Now, let me show you a solution to actually get you where you want this way."
Leh Meriwether: Wow. Okay. So the numbers are easy. It's just getting the emotion set aside so they can see the numbers.
Beau Varnadoe: Correct.
Leh Meriwether: You know and I've seen that 'cause the numbers don't lie.
Beau Varnadoe: Right.
Leh Meriwether: At the end of the day they are what they are. I have had cases where the numbers were the numbers and we said, "Look. I'm not advising my client to do a settlement that runs contrary to the numbers. There's not enough cash to pay alimony and child support in the amount that you are asking." The case kind of went on pause for three-four months, and then the other person was able to finally set aside their emotions and accept the last settlement offer, so sometimes that's all it takes.
Leh Meriwether: Up next we're going to continue to talk to Beau, and we're going to talk about the things that he can't do in a divorce, and we're going to talk other things that he can do post-divorce to help people get through this process, and come out without winding up in bankruptcy court.
Leh Meriwether: Welcome back everyone. I'm Leh Meriwether, and with me is Todd Orston, and in studio today we have Beau Varnadoe, who is a CDFA, a certified divorce financial analyst. Todd and I have been learning about all the things that he can do to help people, our clients, and it's not just our clients but anybody out there that's going through a divorce regardless of who your attorney is you can definitely use Beau's services or someone like Beau to help you work through the financial aspects of your divorce, and they can be, I think the biggest takeaway is everybody can do math. I think my biggest takeaway for the first three segments is everyone can do math. I mean if you can do basic balancing a checkbook. But the problem is when you're in the middle of a divorce that emotion can take over, and blind you, and cause you to just be making horrible financial decisions.
Leh Meriwether: Beau, what you bring is a level of unemotional or unbiased evaluation to help clear the haze that's created by the divorce process.
Beau Varnadoe: Exactly, right.
Leh Meriwether: All right. Well, we've been diving into all kinds of questions but there's some we still haven't gotten to.
Todd Orston: Yeah, let me jump in with this question. We've been talking about help you can provide during a divorce, okay? Can you continue your assistance once the divorce is finalized? Because I mean I'm hearing what you do, and the assistance that you give, obviously, the need for that kind of help doesn't end with a divorce order. So, can you continue that help of that client?
Beau Varnadoe: Sure. Once the divorce is final I have to sever my relationship with the client as their CDFA. But at that point we can then institute a new agreement, a new relationship as their financial advisor. That helps a lot because I was with them during the turmoil. I know all the finances. At this point, it's very simple to move forward with me. Some of my best clients to this day have been ones that I've helped through divorce.
Todd Orston: And that's great to hear because I mean again, like you're saying, it doesn't stop just because we've gotten you through the divorce process. You still need some additional help especially as you're rebuilding your life financially speaking, and somebody like you can provide immeasurable amounts of help.
Beau Varnadoe: Sure. One of my very best clients to this day was going through a divorce, and her attorney brought me in, and suggested that she speak to me. She was kind of skeptical in the beginning because she was like, "Okay. Yeah. [inaudible 00:36:31]. He has a 401(k) and yeah, he has a pension. But, how complicated could that be? I understand a 401(k), I don't really need one." But she did sit down with me and once I started pointing some things out, she goes, "Oh well, I just realized I didn't know what I didn't know." And she says, "I could not have made it through that divorce without you."
Beau Varnadoe: To your point of going post-divorce, she got a sizable portion of his pension. But now his company is shutting down the pension, so her question to me was, "Now, what do we do?" Well we have a plan for that as well, so we have that ongoing relationship.
Leh Meriwether: Oh, great. All right. I'm going to go, move forward in time. Before a divorce is filed, can you sit down with couples prior to filing for a divorce to see if perhaps if the divorce is being caused by some financial discrepancies or struggles, they can't communicate about finances? Can you help them work through that so they don't have to file for divorce? Or if it's not related to finances, can you help work with them on the financial side to come up with a settlement agreement?
Beau Varnadoe: Sure. We can help with the finances to get that. If you can settle the financial problems you'll see the stress in the relationship go way down, which will diminish the likelihood of the divorce, may not eliminate it completely, but will make things easier to get along with. If it's not financial in nature, and they've just decided it's time to end the marriage and go. Well, let's craft a financial situation that we can both be happy with, and we'll go our own ways.
Leh Meriwether: And you work on that?
Beau Varnadoe: Yes.
Leh Meriwether: Okay. But you had mentioned this funny anecdote, something about where you were talking about how sometimes you sit down with couples, and they haven't talked about finances, and they surprise each other.
Beau Varnadoe: Absolutely. It happens all the time that you sit down with a couple, and you start talking about retirement, and you ask them what retirement looks like, the looks that some of them give each other is like they've never heard this before. They just don't talk about finances a lot of times. And then if you don't prepare for the future, the future bite you. And so, it's funny to watch. I've actually had couples come away much closer after putting a financial plan together.
Leh Meriwether: Wow. That's a good marriage tip right there. Sit down with a financial advisor. Sit down with Beau and come up with a plan for your future.
Beau Varnadoe: There you go.
Leh Meriwether: All right. So we've been talking about all the things that you can do, let's talk about all the things that basically the rules for CDFAs prevent you from doing. What is some of the limitations that you have as a CDFA?
Beau Varnadoe: Sure. First and foremost, I am not an attorney. I never went to law school. I do not want to go to law school. My role is not to tell the client what they are entitled to, or what they deserve. My role is to say, "Based on this settlement that's been proposed, here's the long-range implications." It's the attorney's job to determine what is deserved and to argue for that with opposing counsel when they're in court.
Beau Varnadoe: Also, a CDFA does not do a business appraisal. That's needs a certified professional in that area. Now, we can help compile information for the business appraiser, and we definitely want to use that information in crafting the divorce. Pension valuation, I can do future value of a pension account. But as far as a pension plan, that actually requires the use of an actuary. Taxes, we all get involved in taxes. That's a big portion, that's a portion of our lives much less divorce. But I am not an accountant. I do not prepare taxes. I do work closely with accounts to help on the tax situations. And mediation, I do not mediate divorces.
Leh Meriwether: So, you're not the mediator?
Beau Varnadoe: I'm not the mediator himself, no. I work with the mediator. A mediator really needs to be specially trained in those areas, but I can help support the mediator.
Todd Orston: Have you ever been brought in in any collaborative cases?
Beau Varnadoe: I have not had a collaborative case yet. I'd like to. I really would.
Todd Orston: Okay. Sure. And collaborative, obviously that means that both parties are coming in, and I'm really dumbing this down, but they're coming in and from the very beginning saying, "We want to work this out. We want to work together." And they jointly retain the services of experts. And so, I could see that being a great fit for you because you're jumping in and going, "All right. I'm going to learn about both of your ... Everybody's finances. And then, we'll figure out what he needs, and what she needs, and you'll move forward."
Beau Varnadoe: Absolutely. Isn't that a growing trend in the world?
Todd Orston: It is, it is. In different states more so than others. Using [inaudible 00:41:16] as an example, I mean it's definitely growing in Georgia, but Florida, it's taking off.
Leh Meriwether: Yeah, there's actually a statute now regarding collaborative divorces, that's what they're called. The Florida Supreme Court, I think, actually has come up with rules that lawyers have to follow. So when they came out with statute saying, "Hey, we want this officially recognized, but we're going to let the courts come up with rules because there's no court governance in a collaborative case." It's just the parties working together. I didn't mean to get off on that collaborative ... You started that.
Todd Orston: I did not, and you don't even have a recording to ... Oh yeah, you do. [inaudible 00:41:56]. All right.
Leh Meriwether: But I do think that your services would be really well-suited for the collaborative process.
Beau Varnadoe: I'd agree with that.
Todd Orston: Look, everybody at this table, we are here to help people, and that's what this show is about to educate people, and introduce people like you because information is key, information is so important. No matter whether you're going through a divorce, or whether or not you just have financial issues, right? I mean there are financial struggles that you need to work out with your husband, or wife, or on your own. People like you, you can step in, and you can offer that advice. You can give that education so they can make, again, like we've been saying, good choices.
Beau Varnadoe: Sure, and that's what it comes down to is having the proper information in front of you in order to make an educated decision to know, "Okay. If I do this, this will be the results."
Leh Meriwether: Beau, we're almost out of time. Before I forget to ask this question, can you tell the listeners if they want to hire your services what's the best way to get a hold of you?
Beau Varnadoe: That's a very good question. My phone number is 770-317-3299. You can call me direct. My email is [email protected]
Todd Orston: That's Varnadoe. [crosstalk 00:43:27].
Beau Varnadoe: Thank you.
Todd Orston: Varnadoe.
Leh Meriwether: Varnadoe.
Todd Orston: Bam.
Beau Varnadoe: There you go. [crosstalk 00:43:36].
Leh Meriwether: Only after you heard me say it multiple times.
Todd Orston: Yeah, but the one time I said it I got it right.
Beau Varnadoe: You now get to go to the family reunion.
Todd Orston: That's right. There you go.
Leh Meriwether: Hey Beau, thanks so much for coming on. We really appreciate it. I've enjoyed learning from you, and how you help people, and how you can help us work with our clients as well.
Leh Meriwether: Hey everyone, thanks so much for listening. If you're enjoying this show, we would love it, wherever you're enjoying this show from, whether it be on the air, or you're listening to an iTunes later, we would love it if you would go out and give us a five-star review. You know what, don't give us anything under a four though, so just a five and above.
Todd Orston: If you can sneak another star in there give us six. [inaudible 00:44:25].
Leh Meriwether: Yeah, definitely. But if you want to find out more information about us you can always read about us online at atlantadivorceteam.com. If you have a topic that you would like us to explore, please email us at [inaudible 00:44:39]. Thanks again for listening.
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