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21. Financial Planning for Women Post-Divorce: Research Insights and Practical Strategies with Michael Kothakota · Planning & Beyond® - Where financial planning meets human understanding

• 0:00
  SPEAKER_00: Like you shouldn't do that.
• 0:02
  SPEAKER_00: That's a financially irresponsible thing.
• 0:05
  SPEAKER_00: When you say those things, it's people feel like it's a value judgment.
• 0:08
  SPEAKER_00: It's a judgment on them.
• 0:09
  SPEAKER_00: It's a judgment that you're this financial expert and you're telling them that they're they're a bad person, basically.
• 0:14
  SPEAKER_00: And so I try to avoid saying that's a bad idea.
• 0:17
  SPEAKER_00: What I try to do is I say, okay, look, here's how we can do that.
• 0:20
  SPEAKER_00: Here's the closest we can get to that.
• 0:22
  SPEAKER_00: And then here are the issues that may come up if we do that.
• 0:25
  SPEAKER_00: It's a collaborative process where they're evaluating it with you.
• 0:29
  SPEAKER_02: Welcome to Planning and Beyond, the show where financial planning meets human understanding.
• 0:35
  SPEAKER_02: As an exceptional financial advisor, you know that financial planning is about more than just numbers.
• 0:41
  SPEAKER_02: It's about giving clients the clarity they need to align their money with what matters most.
• 0:47
  SPEAKER_02: Which is why each episode is designed with that goal in mind.
• 0:51
  SPEAKER_02: You'll learn how to uncover the psychology behind client decisions and gain insights and behavioral strategies needed to create deeper, more meaningful client relationships.
• 1:01
  SPEAKER_02: You'll discover techniques for navigating emotional client situations, drawn from conversations with leading industry experts in behavioral finance, psychology, communication, and more.
• 1:12
  SPEAKER_02: Whether it's mastering discovery meanings, handling sensitive client conversations, or understanding what is truly keeping your client stuck, you'll walk away with not only strategies that you can use in your next client meeting, but also the confidence to do so.
• 1:28
  SPEAKER_02: Oh yeah, hi.
• 1:29
  SPEAKER_02: I should probably introduce myself.
• 1:31
  SPEAKER_02: I'm your host, Ashley Kwamey, a therapist who somehow wandered into the world of financial behavior and kind of decided to stay.
• 1:39
  SPEAKER_02: My mission is to help you bridge the gap between financial planning and human understanding.
• 1:45
  SPEAKER_02: Because remember, finances don't have feelings, but your clients do.
• 1:49
  SPEAKER_02: Let's dive in.
• 1:56
  SPEAKER_02: Welcome to Planning and Beyond, the show dedicated to helping you deepen your relationship with your clients and yourself.
• 2:03
  SPEAKER_02: I'm your host, Ashley Kwame.
• 2:05
  SPEAKER_02: Today I'm joined by Michael Kothakota, a financial planning practitioner and researcher.
• 2:11
  SPEAKER_02: Michael's research has focused primarily on divorce financial planning.
• 2:15
  SPEAKER_02: And within his firm, Wolfbridge Wealth, he specializes in working with women in divorce, which is exactly what we're going to talk about today.
• 2:25
  SPEAKER_02: Michael, before we jump in, I would love if you could take a moment and maybe share a little bit about how did you get into this area of research and work, divorce financial planning?
• 2:38
  SPEAKER_00: Yeah, the work came first.
• 2:40
  SPEAKER_00: And so what was really interesting is that around 2008 is when I left a large regional firm and my wife and I started Wolfbridge that year, November.
• 2:50
  SPEAKER_00: In fact, like right as the economy was collapsing and the markets were roiling.
• 2:55
  SPEAKER_00: So the absolute best time to open a financial planning firm.
• 2:59
  SPEAKER_00: And so part of that was okay, well, clients were you know a little skittish about even transferring, they were unsure what to do.
• 3:06
  SPEAKER_00: And so basically, I would take anything that walked in the door.
• 3:10
  SPEAKER_00: If you if you wanted your mortgage refinanced, you want to know if it made sense to do that, sure, I'll I'll uh I'll take a look and help you figure that out.
• 3:19
  SPEAKER_00: And what ended up happening is somebody came in who was going through a divorce, a woman, she was early 60s, you know, had been married for 30 years, and it was the situation was actually fairly complex.
• 3:31
  SPEAKER_00: And I said, sure, I can definitely help you do this.
• 3:34
  SPEAKER_00: And I had very little knowledge around what divorce looks like.
• 3:39
  SPEAKER_00: So I I actually approached it from this from a financial planning lens.
• 3:42
  SPEAKER_00: I said, Well, you know, let's talk about what you need, and then let's kind of back into what a good settlement would look like, and we can then advise your you know your attorney on that.
• 3:51
  SPEAKER_00: So then uh what what ended up happening is most cases actually do not go to trial, right?
• 3:57
  SPEAKER_00: It's like 94% of cases never go to trial.
• 4:01
  SPEAKER_00: So this is my first case, it went to trial.
• 4:03
  SPEAKER_00: And I remember testifying and thinking, this is a really terrible way to resolve you know marital dissolution, right?
• 4:11
  SPEAKER_00: It doesn't make sense.
• 4:12
  SPEAKER_00: Like you're coming at it from a perspective of rights and entitlements, and it's it's very macro and it's very, well, this is what happens to everybody.
• 4:22
  SPEAKER_00: And then they try to make it sound like it's individual to their case, but they're using all this historical precedent, and it's just a really weird way to try to figure out how to manage individual families.
• 4:34
  SPEAKER_00: And so I left that courtroom and I said, you know, I bet that they're, you know, if everybody's doing it like this, this is terrible.
• 4:42
  SPEAKER_00: Like so, something needs to change.
• 4:44
  SPEAKER_00: And so I thought, well, I'm young, I'm full of energy, I'm gonna, I'm going to uh figure out how to make this change.
• 4:50
  SPEAKER_00: And so I actually put together this presentation.
• 4:52
  SPEAKER_00: I found this group of mediators, and at the time wasn't clear on what mediators actually did.
• 4:57
  SPEAKER_00: And in North Carolina, most mediators are attorneys, and I did not know that.
• 5:02
  SPEAKER_00: So I go to this place where I am gonna present.
• 5:06
  SPEAKER_00: They were happy to have me present to this North Carolina Association of Mediators, and I immediately said, attorneys are doing this wrong.
• 5:15
  SPEAKER_00: And so I basically just told them that their approach was backwards and not knowing that they were attorneys.
• 5:22
  SPEAKER_00: And I thought maybe mediators would do this better.
• 5:25
  SPEAKER_00: And actually, they they weren't really, you know, nobody was offended, but one uh one attorney in particular who I've been friends with ever since, you know, and have worked with them on countless cases, came up to me and said, Hey, that's exactly what we do in collaborative divorce.
• 5:38
  SPEAKER_00: We approach it actually from a financial planning perspective.
• 5:41
  SPEAKER_00: And so I said, Oh, okay.
• 5:42
  SPEAKER_00: So I went back, put on my website, I do collaborative divorce, you know, not practicing law, of course, but you know, I help with the financial aspects of it.
• 5:50
  SPEAKER_00: And so that's kind of where it took off.
• 5:52
  SPEAKER_00: I I did I had somebody come in who was actually going through a collaborative divorce, and it also something that doesn't happen very often.
• 5:59
  SPEAKER_00: I think at the time there were where I live, there were about four collaborative attorneys.
• 6:04
  SPEAKER_00: So not that many.
• 6:05
  SPEAKER_00: And my very next case happened to be a collaborative divorce.
• 6:08
  SPEAKER_00: And so I met this group of folks and started working with them and then did more and more of that.
• 6:13
  SPEAKER_00: And that's kind of how I got into divorce.
• 6:16
  SPEAKER_00: And then as I'm going through the process, you start to come up with questions like why are these interactions so difficult?
• 6:22
  SPEAKER_00: You know, what are the outcomes?
• 6:23
  SPEAKER_00: Are they a lot of the things we hear about divorce in the media?
• 6:27
  SPEAKER_00: Are those things actually true?
• 6:29
  SPEAKER_00: Because my experience is not, doesn't fit that.
• 6:31
  SPEAKER_00: And so, just in general, like how we and how we solve problems is very much a it's still very legal-centric.
• 6:38
  SPEAKER_00: Our our country is built on laws, and so it's just this really interesting way to say, okay, well, what's better?
• 6:43
  SPEAKER_00: Is it better to follow what the law is doing, or is it better to kind of actually work with individual families and see the best way to resolve this?
• 6:52
  SPEAKER_00: In particular, what I would find is even with clients who I would work as a neutral and collaborative.
• 6:58
  SPEAKER_00: So I basically work for both people.
• 6:59
  SPEAKER_00: But what was interesting is typically the a couple would have like a financial advisor, and I'm sure that this is not something that is new to you.
• 7:08
  SPEAKER_00: Typically, it's going to be the man who has been talking to the financial advisor.
• 7:12
  SPEAKER_00: And so there's there is this imbalance of knowledge and advice, and you have this person who can bring an entirely different perspective that's kind of been ignored.
• 7:22
  SPEAKER_00: And then now for the first time, they're they're getting to get feedback on you know what they think and what they want life to look like financially.
• 7:30
  SPEAKER_00: That's kind of how I I got into it.
• 7:31
  SPEAKER_00: So I ended up working with a lot of the women who would get divorced after the divorce process.
• 7:37
  SPEAKER_02: That's such a necessary part of financial planning, but east also within law, too, is having somebody who is collaborative.
• 7:48
  SPEAKER_02: And, you know, the 10 years, right, really kind of first 10 years that I was practicing, focusing on couples who are going through divorce and helping them navigate the parenting aspect was my role in that.
• 8:03
  SPEAKER_02: So providing guidance on what does this parenting plan look like for couples who are divorcing?
• 8:09
  SPEAKER_02: And I don't do that anymore for a lot of reasons.
• 8:12
  SPEAKER_02: Very, very emotionally taxing work.
• 8:16
  SPEAKER_02: But in that time, like working with divorce attorneys, you know, there is a difference, I think, from working with professionals who are more collaborative during this process versus those who maybe aren't or don't have that training.
• 8:30
  SPEAKER_02: And so I think it's wonderful that you have this experience with this client.
• 8:34
  SPEAKER_02: And out of that, right, you found like, oh, I don't really know how to do this, and this didn't feel great.
• 8:40
  SPEAKER_02: Felt really like wrong, you know, like in some ways, right?
• 8:44
  SPEAKER_02: Like attorneys aren't doing this right.
• 8:46
  SPEAKER_02: Like, this is not great.
• 8:47
  SPEAKER_02: Like this could be better.
• 8:49
  SPEAKER_02: I love that you took that experience and then, you know, moving forward, have also been educating those and trying to do that better.
• 8:56
  SPEAKER_02: And I know that you've also been involved in research as well around just divorce and and and what what that looks like for uh the financial planning field.
• 9:08
  SPEAKER_02: Can you talk a little bit about just some of the research findings?
• 9:13
  SPEAKER_02: Maybe I know that you have some around like retirement spending, or I'm sorry, retirement saving there, just saving in general.
• 9:19
  SPEAKER_02: Can you speak a little bit about what that looks like, maybe specifically for women as they're going through divorce and after?
• 9:26
  SPEAKER_00: Yeah, absolutely.
• 9:26
  SPEAKER_00: I love talking about my research.
• 9:28
  SPEAKER_00: So the I do want to, you know, caveat a lot of this, the research that I've done, it's traditional like economic style research, big groups, and so it's averages, and so it doesn't get the different idiosyncrasies of that are inherent with different client relationships and different people.
• 9:43
  SPEAKER_00: But so I can I'll start with the first project I worked on in in graduate school was actually looking at savings behavior and alimony.
• 9:51
  SPEAKER_00: So alimony, for those who don't know, is typically it's going to be a cash transfer from one spouse to another.
• 9:57
  SPEAKER_00: Historically, because men have been typically the those who work outside the home typically earn a little bit more.
• 10:03
  SPEAKER_00: So that those cash transfers are usually going from men to women.
• 10:06
  SPEAKER_00: And what I noticed through practice was when in in the outcomes afterwards, it is of course, these were anecdotes, is that women who didn't get as much alimony, who you know, maybe sought during the process to empower themselves, you know, gainful employment, going back to school.
• 10:24
  SPEAKER_00: Hey, look, instead of paying the alimony, why don't you pay pay for a master's degree or a doctorate degree?
• 10:30
  SPEAKER_00: Their outcomes were significantly better.
• 10:32
  SPEAKER_00: And one way was that they would typically save more.
• 10:36
  SPEAKER_00: And I looked at this from the perspective of, well, is it because it's not seen as their money?
• 10:42
  SPEAKER_00: Right.
• 10:42
  SPEAKER_00: So you get these alimony payments, and does that is it because I because we would have savings built into their budgets.
• 10:48
  SPEAKER_00: Say, hey, we're gonna make sure that you can still save, but they just wouldn't they just wouldn't do it.
• 10:52
  SPEAKER_00: And so they would consume that money rather than save it.
• 10:54
  SPEAKER_00: And so what I I said, well, is does alimony actually inhibit savings behavior?
• 10:59
  SPEAKER_00: And it's really challenging it was really challenging to do this because for a variety of reasons, not that many people get divorced.
• 11:05
  SPEAKER_00: I mean, a good number of people get divorced, but then very few people actually get alimone.
• 11:10
  SPEAKER_00: And so you've got this sample that shrinks really small.
• 11:13
  SPEAKER_00: And so we did see some some marginal effects of that women who received alimony did sit tend to save less, and in some cases had a lower pro and had a lower probability of saving, as opposed to those who did not receive alimony.
• 11:27
  SPEAKER_00: So that was my first kind of interesting finding.
• 11:29
  SPEAKER_00: I'd love for that to be, you know, replicated.
• 11:31
  SPEAKER_00: Again, individuals vary on how they uh respond there.
• 11:35
  SPEAKER_00: But then that I I did my dissertation just kind of on the total kind of savings, investing, distribution process.
• 11:44
  SPEAKER_00: And so we looked at savings behavior in both like emergency savings, retirement savings, and then again for how do people invest.
• 11:51
  SPEAKER_00: And so it was interesting is some of the differences between men and women were women tended to spend focus more on emergency savings and men would focus more on retirement savings.
• 12:00
  SPEAKER_00: So you you started to see both of them would drop off immediately after the divorce for retirement and emergency.
• 12:06
  SPEAKER_00: But women would pick back up with emergency savings, men would pick back up with retirement savings, and women would not.
• 12:12
  SPEAKER_00: But on the other hand, what was really interesting is that women would actually not rebalance as much, even though they would say that they were more risk averse, they actually took on more risk in their portfolios.
• 12:23
  SPEAKER_00: And what would have been really interesting is we could see if there was an advisor in there or not advising them, but they're they didn't have that data in this particular data set.
• 12:31
  SPEAKER_00: You know, that was something that was pretty interesting.
• 12:34
  SPEAKER_00: I also did a simulation study that, you know, kind of just showed that you'll have better outcomes if you get more property instead of alimony.
• 12:43
  SPEAKER_00: Again, that wasn't real people, but it was it was kind of an interesting model to look at.
• 12:47
  SPEAKER_00: And then my wife and I did a couple of really interesting studies.
• 12:51
  SPEAKER_00: Well, it was one study with three different parts where we looked at what do people think about alimony?
• 12:57
  SPEAKER_00: So what is considered fair?
• 13:00
  SPEAKER_00: And we did it across a couple of different frameworks.
• 13:03
  SPEAKER_00: So we looked at if there was an affair, if one person, if there was an educational discrepancy, and if there was somebody who you know stayed at home.
• 13:11
  SPEAKER_00: And so we and we would switch this, we we randomized who the who received a um different vignettes.
• 13:18
  SPEAKER_00: And the reason we did this fairness thing is because in general, alimony, any sort of statute is supposed to be based on like public policy.
• 13:27
  SPEAKER_00: And so public policy stems from what the people want.
• 13:29
  SPEAKER_00: And so, well, what do the people actually want?
• 13:31
  SPEAKER_00: And what was really interesting is you would see it didn't matter actually if you were male or female that that if you had an affair, people wanted you punished for the most part.
• 13:40
  SPEAKER_01: Yeah, yeah.
• 13:41
  SPEAKER_00: You're more likely to have to pay alimony, you were more likely to have to pay more alimony than if there was no affair.
• 13:49
  SPEAKER_00: And so that it didn't matter if you were a man or a woman and if you were the breadwinner or not.
• 13:54
  SPEAKER_00: And then they would, you know, not award it to people who, if you were the dependent spouse and you you had an affair.
• 13:59
  SPEAKER_00: What was interesting is that you definitely saw that in like Gen X and older, but then as millennials and look and younger, what you found is like they they didn't think that that mattered, which is kind of you know, very it's very progressive and very interesting.
• 14:13
  SPEAKER_00: And that that was actually kind of a theme across all of the conditions educational discrepancy, stay-at-home.
• 14:20
  SPEAKER_00: But it I think that's kind of interesting because Gen X kind of had those same kind of ideas and back in the day, and then they got married.
• 14:26
  SPEAKER_00: It'd be interesting to see, you know, follow-up that with those folks or with that generation and see what the outcomes were.
• 14:32
  SPEAKER_00: But it was the same sort of thing.
• 14:34
  SPEAKER_00: If there was an educational discrepancy and somebody, you know, somebody paid for their spouse's medical degree.
• 14:40
  SPEAKER_00: Guess what?
• 14:40
  SPEAKER_00: You should get more alimony.
• 14:41
  SPEAKER_00: I mean, so that was kind of the the outcome of those things.
• 14:44
  SPEAKER_00: And we actually looked at, so there's some national formulas and we compared what people would do with some of those national formulas, and then on average, they were they tended to be a little bit more than what the national formulas were saying we should.
• 14:56
  SPEAKER_00: Those are that's kind of most of the divorce research, which I think is fascinating stuff.
• 15:01
  SPEAKER_00: It's just that it is very much an you know average sort of thing.
• 15:07
  SPEAKER_00: We're looking at averages here, but sure, right.
• 15:09
  SPEAKER_02: Well, I think in listening to you kind of talk and share about these behavioral patterns specifically for women around saving or spending, right?
• 15:21
  SPEAKER_02: There's a psychological component to how they are impacted by whether it's the divorce or just how they look at money in general, right?
• 15:30
  SPEAKER_02: From what I'm hearing right from you.
• 15:33
  SPEAKER_02: So as a financial planner, right, who maybe is listening right now, listening to, okay, there's these patterns that maybe women post-divorce might show.
• 15:44
  SPEAKER_02: And there's some, you know, psychological aspects, emotional aspects certainly that are going on, you know, here.
• 15:51
  SPEAKER_02: How can planners maybe address these kind of psychological behavioral dimensions that play out and certainly impact the financial planning process?
• 16:02
  SPEAKER_00: That's a really good question.
• 16:04
  SPEAKER_00: I think, you know, one of the things to consider is planners in general, we focus on retirement, right?
• 16:10
  SPEAKER_00: So we're very, we tend to be very future oriented for our clients.
• 16:12
  SPEAKER_00: We're like, you know, some of the decisions you make now are going to affect you in the future.
• 16:16
  SPEAKER_00: And there's a lot of male financial planners, right?
• 16:19
  SPEAKER_00: We I think we've had, we've probably, you and I've had this conversation before, I'm sure.
• 16:23
  SPEAKER_00: And so they they're bringing a male perspective, right?
• 16:25
  SPEAKER_00: They're thinking there's still, and if you think about my dissertation research where these men were very future oriented, probably the financial planners are gonna be very future oriented too.
• 16:33
  SPEAKER_00: And if they bring that to a relationship with a woman client and they don't listen, uh they're not gonna hear what they need to hear.
• 16:39
  SPEAKER_00: And so I think one of the things is if you have a client who is their caretaker, so women tend to be the primary caregivers even after divorce, even if custody is even, they still still tend to do more of that work.
• 16:54
  SPEAKER_00: And so they're thinking more about current consumption.
• 16:57
  SPEAKER_00: Am I gonna be able to make the school payment?
• 16:59
  SPEAKER_00: Am I gonna be able to pay for healthcare?
• 17:02
  SPEAKER_00: Am I gonna be able to get groceries?
• 17:05
  SPEAKER_00: And so they're thinking more about this current consumption, which is absolutely important.
• 17:09
  SPEAKER_00: And rather than moving off of that, right?
• 17:11
  SPEAKER_00: So rather than saying, okay, yeah, look, that's all important, but we need to, you know, we need to focus on your future, you have to spend a lot of time in that space.
• 17:19
  SPEAKER_00: You have to spend a lot of time in the space where you're talking about.
• 17:22
  SPEAKER_00: I I think you should spend a lot more time in that space.
• 17:24
  SPEAKER_00: I shouldn't say you have to, but if you spend a lot more time in that space, you'll you'll hear the reasoning behind that.
• 17:30
  SPEAKER_00: But then also by listening, they're more likely to listen to you when you start to talk about, hey, you know, this is I I'm glad that we're doing this, I'm glad we're talking about this.
• 17:39
  SPEAKER_00: But we all I also want to make sure that your future is taken care of.
• 17:42
  SPEAKER_00: Like we're gonna take care of your kids' future, your kids' present, your present, your kids' future, but we need to, we should, we should focus on your your future as well.
• 17:49
  SPEAKER_00: And then it gets women, again, on average, this is something that could happen, they might think a little bit more future oriented.
• 17:55
  SPEAKER_00: And, you know, I think that that's really one of the biggest parts is actually just listening to your client and rather than thinking that the way that you would do something and the way that you think something should be done is the right way.
• 18:07
  SPEAKER_00: You know, whether they're they're thinking about being able to afford groceries or maybe they're thinking about college for their kid, whatever their individual circumstances, if you listen to it and you respond to it, you acknowledge it and acknowledge that it's important, right?
• 18:22
  SPEAKER_00: You can then have the conversation about some of these other things.
• 18:25
  SPEAKER_00: And I think, you know, some of the challenge there is we as planners don't spend a lot of time, you know, we have an agenda, right?
• 18:32
  SPEAKER_00: We want to get through this meeting.
• 18:34
  SPEAKER_00: And sometimes it just takes a while.
• 18:36
  SPEAKER_00: Like you have to sit in that moment for a long time.
• 18:39
  SPEAKER_00: You have to sit, you have to have the conversation that goes a lot deeper than maybe you think it should have to.
• 18:46
  SPEAKER_00: And I think cultivating that sense of curiosity about this person will let you get the information you need to and get them in a place that'll allow you to help them.
• 18:54
  SPEAKER_02: Yeah, I think you're spot on in just my observations as a clinician with regards to women that are going through, actively going through the divorce process, but even post-divorce, they are very, very focused on prioritizing immediate needs, meeting those immediate like financial needs.
• 19:16
  SPEAKER_02: And you're right, especially if they are primary caretakers for other specifically kids, like their mentality is I have to be able to pay for back to school shopping, pay for this field trip.
• 19:28
  SPEAKER_02: I need to be able to, you know, do X, Y, and Z, the birthday gift for the 10 million birthday parties that kids get invited to.
• 19:37
  SPEAKER_02: That is where like mentally and emotionally they are consumed.
• 19:41
  SPEAKER_02: And some of that I think maybe you've observed this.
• 19:43
  SPEAKER_02: I'd be curious, is I know for most women who are also mothers, they're very concerned with their kids' lifestyle to a degree not really being interrupted.
• 19:56
  SPEAKER_02: They want to be able to still provide and maintain a very similar lifestyle for their kids, potentially at their own detriment, a financial detriment.
• 20:05
  SPEAKER_02: I'm I'm curious because that's some of my observation just as a clinician, but I'm curious on like the financial planning side, is that something that maybe you've also observed for female clients post-divorce?
• 20:18
  SPEAKER_00: Absolutely.
• 20:19
  SPEAKER_00: Especially if they have young kids.
• 20:20
  SPEAKER_00: I mean, if they have older kids, they tend to be less concerned with that.
• 20:24
  SPEAKER_00: Although, you know, depending on if they're in if if they're out of the house, they tend to be less concerned about that.
• 20:29
  SPEAKER_00: But but for sure, right?
• 20:31
  SPEAKER_00: Nothing should change for the kids, which is kind of unrealistic, frankly.
• 20:35
  SPEAKER_00: But it's really hard to tell somebody you're going from one household with maybe one income, maybe two incomes, if you're lucky, and then you're chasing, you know, you've got either one income chasing greater expenses or two incomes chasing greater expenses.
• 20:50
  SPEAKER_00: Either way, you know, unless you are extremely affluent and you know are saving a bunch, things are gonna have to change.
• 20:56
  SPEAKER_00: And that's I think it's really difficult to to kind of you know think through that for anybody.
• 21:02
  SPEAKER_00: And I do agree though that that women tend to be more concerned with that and men less so.
• 21:07
  SPEAKER_00: They tend to be less they're they tend to be more accepting that, yeah, things just gonna have to change.
• 21:11
  SPEAKER_02: Is there a point in working with clients?
• 21:14
  SPEAKER_02: I know that you sp you specialize in working with female clients post-divorce.
• 21:18
  SPEAKER_02: We've been talking about how in the immediate, like aftermath, financial planners can really do, should really do a good job listening and leaning into maybe understanding where they are presently.
• 21:28
  SPEAKER_02: Is there a point from your from your experience where it's appropriate then to start transitioning into more of that long-term planning or or focus?
• 21:40
  SPEAKER_02: And I would imagine there's some variability there, but what maybe what does that look like?
• 21:46
  SPEAKER_02: What can advisors you know be looking for as far as those cues to okay, we've been focusing on the short term.
• 21:53
  SPEAKER_02: Now it's maybe more appropriate to be focused on more long term goals and planning.
• 21:58
  SPEAKER_00: Yeah, I think well what.
• 22:00
  SPEAKER_00: And having plans for what those meetings are going to be.
• 22:02
  SPEAKER_00: And some of a a number of advisors have plans on we're going to have our first meetings, we're going to talk about this, our second meeting is going to talk about this, and our third meeting is going to talk about this.
• 22:10
  SPEAKER_00: And I think having a you know at least a general framework for that is helpful in getting to that point because you're setting the tone that, like, hey, we're going to talk about this, just not going to talk about it today.
• 22:21
  SPEAKER_00: And I think you can move those things around, right?
• 22:23
  SPEAKER_00: So if there's, you know, for example, you know, you're having a conversation and you know, at the at the very beginning, so discovery meeting or whatever folks want to call it, and then you know, something comes up where the estate plan actually needs to be done fairly quickly.
• 22:39
  SPEAKER_00: And you have that as the last thing that you're going to talk about.
• 22:42
  SPEAKER_00: And this person is really concerned about the estate plan because her mom died without uh an estate plan and it was a mess for her because she had to be the executor.
• 22:50
  SPEAKER_00: And so she what she might say, so she might just be like, that's something I really want to take care of right now.
• 22:54
  SPEAKER_00: So that might be the next thing that you do.
• 22:56
  SPEAKER_00: But if you have, you know, a general plan and you say, hey, listen, you know, our first thing, I'm just we're gonna get to know each other, then we'll have a conversation about your values and your goals, which this is kind of how I approach things.
• 23:07
  SPEAKER_00: And then eventually we'll start talking about some of these other things.
• 23:10
  SPEAKER_00: But if priority is to talk through current needs, then that's what we're gonna focus on.
• 23:15
  SPEAKER_00: And then in three months, when we have that meeting, we're gonna start talking about retirement.
• 23:19
  SPEAKER_00: And then you have that meeting and you say, Hey, so we're gonna we're gonna start talking about this.
• 23:23
  SPEAKER_00: And so that way it's they're they're prepped for it, but you've already taken care of the things that they're most concerned about.
• 23:28
  SPEAKER_00: Some women come in and they say, Well, look, I'm really concerned.
• 23:29
  SPEAKER_00: Am I gonna be able to live in retirement?
• 23:31
  SPEAKER_00: Because they're, you know, say they're you know, there's a lot of talk about what they call gray divorce, which I just say it's divorce.
• 23:38
  SPEAKER_00: I mean, at this point, it's people get divorced at different points in their lives.
• 23:42
  SPEAKER_00: I we don't I don't know that we need to assign a name to it, but but they're they're closer to retirement, and so they're really thinking about like, well, there's not gonna be any alimony, there's not gonna be a whole lot of time for accumulation.
• 23:52
  SPEAKER_00: Is what I'm gonna get from this state, is that gonna be enough?
• 23:55
  SPEAKER_00: I need to know.
• 23:55
  SPEAKER_00: So in that case, they might be more future oriented, their kids are gone, they might be more future oriented.
• 24:00
  SPEAKER_00: You have that conversation first.
• 24:02
  SPEAKER_02: Yeah, that makes a lot of sense.
• 24:03
  SPEAKER_02: And I'm thinking here too, like working with anyone who is going through an emotional time period can be really difficult.
• 24:14
  SPEAKER_02: But I think that there are some additional unique challenges that come with working with specifically post-divorce clients.
• 24:23
  SPEAKER_02: And, you know, we're talking about women today.
• 24:26
  SPEAKER_02: And, you know, I'm kind of smiling as I'm prefacing this question because I'm very, I'm very curious as to how you do this.
• 24:32
  SPEAKER_02: I know that during emotional times, and for women, you know, they're dealing with maybe, you know, there's an income disparity, there's career disruptions potentially.
• 24:41
  SPEAKER_02: You're dealing with a lot, maybe some identity, some grief there.
• 24:46
  SPEAKER_02: There can be a lot of emotions and in that place and thinking about a client specifically.
• 24:50
  SPEAKER_02: So I'm trying to be careful around how to talk about this, you know, in a sensitive way.
• 24:55
  SPEAKER_02: But I have observed uh in some clients that there can be a lot of flip-flopping around.
• 25:01
  SPEAKER_02: I want to do this.
• 25:01
  SPEAKER_02: Oh, wait, no, just kidding.
• 25:03
  SPEAKER_02: I want to do that.
• 25:04
  SPEAKER_02: And what do you mean, Michael?
• 25:06
  SPEAKER_02: I can't, you know, stay in the house.
• 25:08
  SPEAKER_02: Like, what do you mean?
• 25:10
  SPEAKER_02: I'm gonna have to downsize.
• 25:12
  SPEAKER_02: There's a lot of intense emotions that can come with going through divorce.
• 25:16
  SPEAKER_02: And so I know how I navigate those things as a clinician, but I'm curious, like in in in what you do, like how do you, Michael, the practitioner, how do you navigate some of the emotional intensity that maybe clients, female clients, maybe specifically, might be bringing in the financial planning in part?
• 25:34
  SPEAKER_00: Yeah.
• 25:35
  SPEAKER_00: So it's important to be realistic, but also to be willing to look for a solution to the problem.
• 25:43
  SPEAKER_00: So financial planning to me is mostly about the function of actually doing the planning, the actual planning that people do is about problem solving and finding a way to make something work.
• 25:54
  SPEAKER_00: And divorce, you know, divorce really kind of puts the constraints on you because not only, you know, you don't have two people who are trying to go in the same direction, you have two people trying to go in different directions.
• 26:05
  SPEAKER_00: They may have some shared interests, but they may have some competing interests.
• 26:08
  SPEAKER_00: So the problem solving has to get a lot more creative.
• 26:10
  SPEAKER_00: But I think it's important to be realistic.
• 26:13
  SPEAKER_00: I'll give you a really quick example that somebody I was speaking to just before I talked to you.
• 26:18
  SPEAKER_00: She wants, she she's not even divorced yet.
• 26:20
  SPEAKER_00: She wants to leave and she wants to buy a house.
• 26:23
  SPEAKER_00: And she's like, Can I just take the money out of my IRA and do it?
• 26:26
  SPEAKER_00: And I'm like, Well, yeah, you can do that.
• 26:28
  SPEAKER_00: But then here are here are the issues with that.
• 26:30
  SPEAKER_00: What I try to avoid doing is saying that's a bad idea.
• 26:33
  SPEAKER_00: Like, you shouldn't do that.
• 26:34
  SPEAKER_00: That's a financially irresponsible thing.
• 26:37
  SPEAKER_00: When you say those things, it's people feel like it's a value judgment.
• 26:40
  SPEAKER_00: It's a judgment on them, it's a judgment that you're this financial expert and you're telling them that they're they're a bad person, basically.
• 26:46
  SPEAKER_00: And so I try to avoid saying that's a bad idea.
• 26:49
  SPEAKER_00: What I try to do is I say, okay, look, here's how we can do that.
• 26:52
  SPEAKER_00: Here's the closest we can get to that.
• 26:54
  SPEAKER_00: And then here are the issues that may come up if we do that.
• 26:58
  SPEAKER_00: It's a collaborative process where they're evaluating it with you, right?
• 27:01
  SPEAKER_00: One of the things I used to do, which I think was a miss, was I would, you know, I would say, you know, what do you think this is a good idea?
• 27:06
  SPEAKER_00: Because like I know it's I know it's not a good idea.
• 27:09
  SPEAKER_00: So I'm not gonna ask them that.
• 27:10
  SPEAKER_00: I'm just gonna, I'm gonna have them, you know, this is the consequence, and then sit there, don't say anything, and maybe they'll they'll come up with, they'll either ask the question, Well, do you think it's a good idea?
• 27:21
  SPEAKER_00: And I can say, Well, I wouldn't do it because of this, you know, because you've got to consider the fact that you're not gonna have enough money in retirement or you're not gonna have enough money to send your kid to the school you want to send them to, whatever the consequence is, and then bringing the focus to the things that are most important to them.
• 27:35
  SPEAKER_00: But you told me that these things were important to you, but if you do this, you're not gonna be able to do those things.
• 27:41
  SPEAKER_00: And that kind of helps them, you know, have a little bit more perspective.
• 27:45
  SPEAKER_00: And so it's I I try not to limit the options, right?
• 27:48
  SPEAKER_00: So let's have as many options as possible, but keeping in mind that if you do this one thing, it's gonna have consequences over here.
• 27:56
  SPEAKER_00: And that's the the interesting thing about you know, wealth management, financial planning, whatever you want to call it, is that you you affect something over here with something over here, and they're all everything, every aspect of your financial life is interconnected.
• 28:09
  SPEAKER_00: And so, sure, you can do this, but this is what's gonna happen.
• 28:12
  SPEAKER_00: And are you okay with that?
• 28:13
  SPEAKER_00: And maybe you are, and so and then reserving that, withholding any judgment, any ideas about what I think is responsible or not, um, has to come away.
• 28:23
  SPEAKER_00: I've got a client who takes money out of their retirement early because they have this, they they value this other thing that is very important to them.
• 28:33
  SPEAKER_00: You know, sure, they're paying a penalty, they're paying taxes, they're paying, you know, large taxes because they have a good salary, but this is important to them.
• 28:40
  SPEAKER_00: And so, you know, they understand the consequences of what they're doing.
• 28:43
  SPEAKER_00: As far as I'm concerned, it's their money and they have to, they get to make that decision.
• 28:47
  SPEAKER_00: And quite frankly, she's realizing the value of that, and it's worth it for her to pay these extra things.
• 28:52
  SPEAKER_00: Many advisors, and I am generalizing here, but many advisors will say, Well, that's just a bad idea.
• 28:58
  SPEAKER_00: You shouldn't do that.
• 28:58
  SPEAKER_00: Like, why would you give the government that money?
• 29:00
  SPEAKER_00: So I try to avoid that.
• 29:02
  SPEAKER_02: Yeah, I can appreciate that, right?
• 29:03
  SPEAKER_02: Highlighting, you know, not trying to create any kind of shame, right, or judgment around whatever that a fight and tangible decision is that they want to make, especially if they're in like an emotional state.
• 29:15
  SPEAKER_02: And I think that there can be something there to that approach of you know, validating, I know this is difficult, you're in an emotional place, I hear you, this decision that you're wanting to make.
• 29:25
  SPEAKER_02: And yes, you can do that.
• 29:27
  SPEAKER_02: Here are the options, right?
• 29:28
  SPEAKER_02: If if you want to do that, or here's some other options, and here are the implications, or here's the impact for, you know, maybe each of those solutions.
• 29:38
  SPEAKER_02: I think that that can, I could imagine that that would land on a client who maybe is in distress or in an emotional state, right?
• 29:46
  SPEAKER_02: That would land a lot better than that's a terrible idea.
• 29:50
  SPEAKER_02: I don't think you should do that.
• 29:52
  SPEAKER_02: Whatever the language might be there.
• 29:54
  SPEAKER_02: I could see that landing a whole lot better on clients from that approach.
• 29:59
  SPEAKER_00: What you said just kind of brings up the it, it also brings up the thought of this is a crisis moment potentially.
• 30:05
  SPEAKER_00: And to have the conversation of, okay, it's not urgent.
• 30:09
  SPEAKER_00: We don't like if it if it's not urgent, you can say if it's not urgent, we don't have to make the decision today.
• 30:13
  SPEAKER_00: You know, let me put together what the options are side by side, and then let like you take a look and then come back in a week and we'll have another conversation about it.
• 30:21
  SPEAKER_00: Um, because sometimes that you know that helps as well.
• 30:24
  SPEAKER_00: And and you'll you'll I have often found that people will come back, women will come back and they'll say, you know what, I think I want to do this instead.
• 30:32
  SPEAKER_00: This seems like more aligned with what I would want to do.
• 30:35
  SPEAKER_02: So yeah, I think that's great.
• 30:37
  SPEAKER_02: One just general advice if we're making decisions and we're feeling like emotional, but especially, you know, around this topic, right?
• 30:44
  SPEAKER_02: Presenting the information side by side, and hey, let's go think about it.
• 30:47
  SPEAKER_02: If we don't need to make a decision right now in this moment, like it's okay if we take our time to make sure that we get it right here.
• 30:53
  SPEAKER_02: So I love that offering.
• 30:55
  SPEAKER_02: I love that that approach.
• 30:57
  SPEAKER_02: So earlier you mentioned working collaboratively with attorneys.
• 31:02
  SPEAKER_02: And I I thought that that was really interesting.
• 31:04
  SPEAKER_02: And it makes a lot of sense to me why there would be this need for financial planners and attorneys to work collaboratively, maybe even mental health practitioners in that mix, right?
• 31:18
  SPEAKER_02: Too, because these are really complex dynamics that are all intertwined together.
• 31:23
  SPEAKER_02: I'm curious, what advice do you have for planners on how they can better collaborate with other professionals, maybe specifically attorneys, to really create a more supportive, I guess, environment for female clients who are going through divorce?
• 31:43
  SPEAKER_00: This is delicate, right?
• 31:44
  SPEAKER_00: So attorneys are trained in a specific way.
• 31:46
  SPEAKER_00: If they don't, if they haven't bought into like the collaborative divorce um paradigm, there's actually a uh like in North Carolina, we have a stat, a collaborative statute.
• 31:55
  SPEAKER_00: So some states do, some states don't, and then there's like a national kind of thing.
• 31:58
  SPEAKER_00: If they're not bought into that, the challenge is very like, let's get your information, rights and entitlements.
• 32:04
  SPEAKER_00: Even women attorneys are trained this way, right?
• 32:07
  SPEAKER_00: So they're doing what they're they're supposed to, they're getting the information rather than uh spending their time listening to what this person actually needs.
• 32:16
  SPEAKER_00: And so when I talk to attorneys, if I'm trying to get them to help understand, you know, a little bit the best way to work with uh some of their women clients, I typically will say, well, like how about let's do like a joint meeting?
• 32:30
  SPEAKER_00: Let's just do one joint meeting.
• 32:31
  SPEAKER_00: So say it's a new attorney that I haven't met.
• 32:33
  SPEAKER_00: Let's do one joint joint meeting where you let me kind of take the lead.
• 32:38
  SPEAKER_00: And then you kind of get to see how much more information that you can get.
• 32:42
  SPEAKER_00: Because you might have a situation where you know they they might be entitled to X and they should be advised of what they're entitled to.
• 32:48
  SPEAKER_00: Absolutely.
• 32:48
  SPEAKER_00: I want to make it clear that people should know what they are able to get under the law, but their goals and values may have they they may not need all of that.
• 32:58
  SPEAKER_00: They may not want all of those things.
• 33:01
  SPEAKER_00: And some women want to stay in the house, some women want to have nothing to do with that house.
• 33:05
  SPEAKER_00: That house has nothing but bad memories.
• 33:07
  SPEAKER_00: And so talking about a lot of people say, well, you know, you're gonna, you can, you know, let's figure out how to get you to stay in the house.
• 33:13
  SPEAKER_00: That's that may not be the approach.
• 33:15
  SPEAKER_00: And so if you're gonna approach an attorney, just kind of, you know, offer, I would I would tell planners to offer to like actually lead a meeting and just see how it goes.
• 33:24
  SPEAKER_00: Tell them you won't charge the client or whatever, and then you just can do that that intake collaboratively.
• 33:30
  SPEAKER_00: I think that can be pretty helpful.
• 33:32
  SPEAKER_00: The other thing that I would say is try to talk about something that you're really good at.
• 33:36
  SPEAKER_00: So maybe you're really good at executive compensation and then go talk to a bunch of attorneys and talk about executive compensation in the context of divorce, and then kind of show and maybe even do role plays with the attorneys of how you would approach this with clients and how you would ask them questions.
• 33:53
  SPEAKER_00: And then you can then model some of these listening techniques, empathy, providing empathy, which is just huge.
• 33:59
  SPEAKER_00: Like if somebody's going through divorce, like you cannot give them enough empathy.
• 34:02
  SPEAKER_00: Like that is how you are gonna get the responses that you need to help them.
• 34:06
  SPEAKER_00: You just don't see that a lot in some of these relationships and in some of the emails.
• 34:11
  SPEAKER_00: And that's that's another thing, too, right?
• 34:12
  SPEAKER_00: Like the I don't know if you've ever read emails.
• 34:14
  SPEAKER_00: I mean, if you were working in the in divorce field, I'm sure you've seen it.
• 34:17
  SPEAKER_00: They are novels and they're and they're very, they're not nice, right?
• 34:22
  SPEAKER_00: So they're not kind.
• 34:24
  SPEAKER_00: Um and even to their clients, they're not they're not kind, they're very factual to the point about saying, you know, telling somebody that you're wrong and this is what this is the way it is.
• 34:34
  SPEAKER_00: That's not the time to do that.
• 34:36
  SPEAKER_00: Like that is somebody gets an email like that, they're just not going to be responsive, and they're that's not gonna be gonna put them in a bad place.
• 34:42
  SPEAKER_00: So, you know, modeling that sort of behavior, I think, is is useful for the attorneys because they're they're attorneys, they're smart and they see that it has an effect and it works.
• 34:51
  SPEAKER_00: And you'd be like, well, maybe I should do that.
• 34:53
  SPEAKER_00: That seems to be something that that works.
• 34:55
  SPEAKER_00: So that that's kind of my advice for planners who want to work with attorneys.
• 34:58
  SPEAKER_02: I think all of that is fantastic.
• 35:00
  SPEAKER_02: Great, great advice.
• 35:01
  SPEAKER_02: Well, Michael, as we are sadly wrapping up our conversation uh here today, I know it they always do.
• 35:09
  SPEAKER_02: Uh they always do.
• 35:11
  SPEAKER_02: I've never found one where I'm like, gosh, that was the longest 30, 45 minutes of my life.
• 35:18
  SPEAKER_02: Um thank thankfully.
• 35:21
  SPEAKER_02: But as we're wrapping up here today, uh, usually I ask our guests if they were to look back maybe in the rear view mirror and go back to when they were first starting out as a professional.
• 35:34
  SPEAKER_02: What are maybe two to three tops tips that you would offer your younger self around maybe a place of from a place of well-being or self-care?
• 35:46
  SPEAKER_02: What are a few tips that you would give to that younger professional, Michael?
• 35:50
  SPEAKER_00: I think that's a really good question.
• 35:52
  SPEAKER_00: And one of the things I didn't mention is that, you know, you mentioned this actually, the how the work is emotionally draining is to, you know, basically, you know, spend some time away from the field.
• 36:02
  SPEAKER_00: I was doing too much divorce stuff.
• 36:05
  SPEAKER_00: And it takes a it takes a uh mental toll on you.
• 36:09
  SPEAKER_00: And to the point where I, you know, you have to get a I had to get a therapist so that I could do my job.
• 36:15
  SPEAKER_00: You know, that doesn't seem like something that uh makes sense.
• 36:19
  SPEAKER_00: Uh so so I would say, you know, early on, bigger breaks, but also the biggest thing to do is to l that I think a lot of people have a hard time with is letting go of the outcome.
• 36:30
  SPEAKER_00: And especially financial planners have a hard time with this, I think.
• 36:33
  SPEAKER_00: Letting go of the outcome is the key to being able to survive in doing this kind of work because you get really invested in it, you've got, you know, you you think you've got a solution and then it blows up in your face, or a client does something crazy, or they listen to the wrong person and it feels like a failure for you, you know, you don't want to fail.
• 36:55
  SPEAKER_00: So it feels really bad.
• 36:57
  SPEAKER_00: So being able to let go of the outcome and the fact that it's not my decision, but what they do, they get to decide.
• 37:02
  SPEAKER_00: I provide the best advice, I provide, you know, whatever I can, and if it fails, it's not on me.
• 37:08
  SPEAKER_00: So letting go of the outcome, I think, is is huge.
• 37:11
  SPEAKER_00: I think that actually applies across financial planning in general.
• 37:14
  SPEAKER_00: People are gonna do what they're gonna do.
• 37:16
  SPEAKER_00: The only thing you can do is provide the best advice.
• 37:18
  SPEAKER_02: Very true.
• 37:18
  SPEAKER_02: I could have used that advice when I was starting my therapy career for sure, especially working with couples.
• 37:25
  SPEAKER_02: Man, oh man, I could have used I could have used that piece of advice for sure.
• 37:31
  SPEAKER_02: I would have saved myself a lot of stress and mental work and heartache.
• 37:36
  SPEAKER_02: I thought you guys knew that.
• 37:37
  SPEAKER_00: I got that advice from a therapist.
• 37:39
  SPEAKER_02: Listen, Michael, just because we know that does not mean that we, you know, accept or internalize that, right?
• 37:47
  SPEAKER_02: There is such a thing as our ego.
• 37:50
  SPEAKER_02: And I think, you know, I don't know.
• 37:52
  SPEAKER_02: I'll speak, I will speak for myself.
• 37:54
  SPEAKER_02: I probably thought that some of that stuff did not apply to me.
• 37:58
  SPEAKER_02: Of like, oh, well, you know, but I can I can help them, right?
• 38:02
  SPEAKER_02: Uh, but I can do this differently.
• 38:04
  SPEAKER_02: I can help them.
• 38:05
  SPEAKER_00: I'll think I'm better.
• 38:06
  SPEAKER_00: Yeah.
• 38:06
  SPEAKER_02: So arrogant, so arrogant.
• 38:09
  SPEAKER_02: So thank goodness for age, wisdom, and some humility along the way.
• 38:14
  SPEAKER_02: But I I hear you.
• 38:16
  SPEAKER_02: Well, thank you so much, Michael, for coming on today.
• 38:20
  SPEAKER_02: If listeners would like to learn more about your work or just connect with you, where can they find you?
• 38:26
  SPEAKER_00: Well, I'm on LinkedIn, so Michael Coastakota, and uh they can go to my website if you want to fill out one of those contact forms.
• 38:34
  SPEAKER_00: But that's uh so that's www.wolfbridgewalth.com.
• 38:38
  SPEAKER_00: I think those are probably the best places to get a hold of me.
• 38:41
  SPEAKER_02: Wonderful.
• 38:42
  SPEAKER_02: We'll make sure that we link those in the show notes.
• 38:44
  SPEAKER_02: Thank you so much for coming on again.
• 38:46
  SPEAKER_02: And for all of you out there tuning in, thank you for allowing Michael and I into your ears and into your mind.
• 38:52
  SPEAKER_02: Until next time, keep planning, keep growing, and keep going beyond.
• 39:00
  SPEAKER_02: Thanks for joining me on this episode of Planning and Beyond.
• 39:03
  SPEAKER_02: I hope you found today's insights valuable and inspiring for both your practice and your personal growth.
• 39:09
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• 39:15
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• 39:20
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• 39:28
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• 39:35
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• 39:39
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• 39:41
  SPEAKER_02: And remember, the best way to grow is to keep learning and sharing.
• 39:46
  SPEAKER_02: Until next time, keep planning, keep growing, and keep going.