Financial Planning, Prenups, and Post-Divorce Recovery

Jamie Lima [00:00:00]:
The Today, we’re thrilled to have Eric Brotman with us. Eric is the CEO of BFG Financial Advisors and the author of the award winning book, Don’t Retire, Graduate. He and his team believe that financial literacy is the key to financial freedom. So they provide free and affordable education resources and accessible financial planning with no asset minimums. I definitely wanna talk about this because we are on the same page here with that. If you’re feeling overwhelmed by your divorce or your current situation in life, don’t be. Eric is here to help us break it down so you can feel confident and prepared by creating a clearer picture of not only your financial situation, but how you can tackle the personal challenges along the way that you might be facing. So grab yourself a cup of coffee or your beverage of choice, buckle up, and let’s once again get you personally and financially empowered.

Jamie Lima [00:00:56]:
Eric, so awesome to have you with us today.

Eric Brotman [00:00:59]:
Jamie, it’s great to be here. And in terms of favorite beverage based on this topic, I think it should probably be scotch, single malt preferably. Absolutely. A coffee conversation.

Jamie Lima [00:01:08]:
No. So if you’re listening to this, you know, you don’t wanna do that while you’re driving. But when you get home or back to the office or whatever, open up that drawer and keep listening. So this is gonna be a great conversation because we’re on the same wavelength here. I’m a certified financial planner as are you. And I’ve been doing that work for almost 20 years now, and you’ve been doing it a very long time as well. So I I’ve over the last couple years have shifted more from my focus on divorce financial planning. So I think, you know, again, we’re on the kind of on the same wavelength here.

Jamie Lima [00:01:39]:
So, like, maybe give me a little bit of background on on your experience and some of the experiences you’ve had relative to divorce, and we can kick it off from there.

Eric Brotman [00:01:45]:
Well, just in general, 1st and foremost, I have been doing this for 31 years, which is hard to believe, and started a company, BFG Financial Advisors 21 years ago, as a startup and bootstrapped and borrowed money from everywhere. And and now we’re a a a company with a a national presence, which is wonderful. In terms of divorce, I certainly have plenty of experience with it. Not only was I divorced on my 28th birthday, which we can talk about, but but we’ve also seen it impact clients and loved ones. And, you know, I was a product of divorced parents as a as a 12 year old, so I I wear that hat as well. And, you know, the the a divorce is a little bit like a death in the family that keeps happening. And, you know, when somebody dies, you you grieve and you move on in various ways. And and certainly, some cases are much, much more difficult than others depending on circumstance.

Eric Brotman [00:02:33]:
But with divorce, especially if you’re divorced with children, it it’s like you get to relive that on an ongoing basis. It’s extremely emotional, and even the best divorces can be really tough.

Jamie Lima [00:02:43]:
Absolutely. And we must be twins separated at birth because my parents were my parents were divorced when I was relatively young, as well. And that’s really what propelled me into the world of finance because I saw the stress and strain that it created for the family. And, you know, God bless my parents who were working as hard as they did to get us through it. My dad was working 2 jobs. My mom worked multiple jobs. And really, they, you know, they were also very young when when they got, they they were married and then they subsequently got divorced. So they they kinda were fighting uphill battle, you know, from the very beginning, but, man, it’s it’s super tough.

Jamie Lima [00:03:18]:
So what are some of the and because this is this is awesome because this is financial planning focused type of conversation and and also a show and all the work that we do. So

Eric Brotman [00:03:28]:
Sure.

Jamie Lima [00:03:28]:
Let’s talk a little bit about, like, the you know, from a comprehensive financial planning perspective, what are some of the things that people need to be thinking as they start preparing for divorce divorce? I I I, of course, have my own tips and tricks and things that I do. I’d love to hear what your thoughts are on that.

Eric Brotman [00:03:42]:
Well, you you know, whether you’re doing business planning or personal planning, the time to plan for divorce is while everybody’s happy and doing great. So you plan for it long before it occurs, not because you’re you’re rooting for it, but because you’re trying to insure against the worst. So in the same way that you buy car insurance, not hoping to have an accident so you can try it out. There are things that you can do. And particularly if you’ve been married before. For a young couple who have no material assets and are just getting started, it’s not really as big a deal. But for people who are remarrying or getting married later in life, or maybe starting over and have kids from multiple marriages, a prenuptial agreement is not romantic, but it is darn important. And coming up with a way to make this palatable in the event it doesn’t work to me is not a it’s not a sign of bad faith.

Eric Brotman [00:04:27]:
It’s not a sign of, you know, it doesn’t create, I think, bad juju. People worry that, oh, planning for that means you’re not all in. And the time to put the lifeboat on the Titanic is before it sets sail. That’s not because you’re hoping to sink. It’s because stuff happens. And when it happens, you, you want to be able to, to both sort of swim to safety in that regard. And, and so I I think the time to start planning for divorce is long before you get married. And I don’t mean like the week before you get married.

Eric Brotman [00:04:55]:
Hey, let’s sign this because that’s not enforceable. There’s all kinds of legal stuff around that. I mean, when you’re starting to talk about combining finances, which is what people who get married or get engaged do, you know, you’re suddenly talking about joint accounts and different beneficiaries and different responsible parties and your legal documents. And so when you’re coming together and you’re starting a union like that, that is where you’re making some pretty big decisions that are harder and harder to undo as you get further along. And so having a sort of break glass in event of emergency box to me is is not I I don’t think that’s bad luck. I think that’s good planning.

Jamie Lima [00:05:34]:
Yeah. So you’re you’re kind of alluding to the whole concept of a prenup. Right?

Eric Brotman [00:05:38]:
Well, it can be. It can be a prenup or it can even be a postnup if you’re already married, although that’s a much harder conversation. There’s nothing less romantic than a prenup. Let’s, let’s call it what it is. But, you know, for, for, for people who’ve been married before, they, there tends to be an understanding that, Hey, I’ve been divorced before. I know how painful that is and I know how expensive it is. And let’s make sure that we don’t put ourselves through that torture that we’ve already been through. For people who’ve never been through it before, they really don’t know just how expensive and just how challenging it can be, especially if there’s acrimony.

Eric Brotman [00:06:12]:
And so it, the time to plan. Yes. A prenup makes a lot of sense for a lot of people, either because one person has kids from a prior marriage or because one person owns a business or has material assets and the other doesn’t. You know, when, when people inherit money from family, that’s typically safeguarded from divorce in most jurisdictions, unless you make the account joint. If you’ve made it joint, it becomes marital. And so a very simple stroke of a pen can mess that up. And so having the right financial advisors, the right legal advisors, the right tax advisors make sense along the way. And while you’re planning to get married, you know, people spend more time picking out their cocktail napkins than they do figuring out their financials, which is bizarre to me.

Eric Brotman [00:06:54]:
Although I do still have some of the napkins from my, my second marriage, which was 17 years ago. Napkins are in good shape, but people spend more time on those things than they do on their own financials. Much in the same way I’ve heard people spend more time planning their vacation than their retirement, which is bizarre.

Jamie Lima [00:07:11]:
Totally bizarre. And I I would concur. I mean, that’s that’s the the main problem with society today. And the and and frankly, it’s just for the lack of education. Right? They don’t teach you this stuff in school. And and it’s up to people like us to to educate and continue to share the information as much information as we can. I feel like that’s like the the Scarlet letter we carry along with ourselves is really just to educate and educate and educate because I did just see here in the state of California that they one of the requirements is to take a financial course before you

Eric Brotman [00:07:38]:
I did I I actually read that. Yeah. I think

Jamie Lima [00:07:40]:
that’s gonna start next year, which is amazing. It’s one of the one of the only amazing things California has done in the last couple decades. But

Eric Brotman [00:07:48]:
Fair.

Jamie Lima [00:07:48]:
That’s a that’s a podcast and a totally different totally different story.

Eric Brotman [00:07:51]:
That also requires a single malt.

Jamie Lima [00:07:52]:
Yes. Understood. Exactly. Yeah. Yeah. Many of them. But you you touched on probably, like, 5 or 6 things in that in that those last comments that I had questions on. So I’m gonna kinda bounce around a

Eric Brotman [00:08:03]:
little bit as

Jamie Lima [00:08:03]:
far as question because it’s it’s all really good stuff. Let’s talk about asset division. Right? That’s one of the things that comes up all the time. Maryland, where you are, community property state, equitable property state, how do what does that look like where you are?

Eric Brotman [00:08:16]:
Maryland, you know, it’s funny. It depends who you ask. Legally, Maryland is not a community property state. It’s a it’s a a state where marital assets are often divided relatively down the middle, but it depends on some other factors. You know, if you ask most divorced breadwinners, I’m not going to say husband because it could be either side of the coin. If you ask the breadwinner who’s been divorced, you will get the sense that the divorce always favors the non breadwinner. And there is a sense of that around alimony. And alimony and child support get confused a lot.

Eric Brotman [00:08:47]:
Child support is something that you’d be paying anyway if your child was living with you. I think there’s a different, a different level of begrudging around paying for your children’s welfare than it is paying for a potential non working or less working spouse to not have to push that envelope. And there’s baggage around it. But in Maryland, generally, if it’s if it’s joint, if it’s been acquired during the marriage, and if it’s not inherited, it’s going to get split in one way or another.

Jamie Lima [00:09:14]:
Are there any tips and tricks around that? Because at least here in California, there’s also the the, the quasi community property. Right? If you move assets that are that are were single name and you and and then you you materialistically change the way that they’re being used or whether if you’re generating income off a particular asset, so on and so forth. Sometimes what it used to be single name property or individually owned separate property can become what’s called quasi community property here in the state of California and in some other states as well. So any thoughts around that?

Eric Brotman [00:09:46]:
What we what we see in a lot of prenups is we see the harshest level of prenup is title governs. So a title governs prenup says, if it’s an individual name, it belongs to that person, period. No matter how it got funded, no matter where it came from, if it’s in that person’s name, it’s that person’s account. The problem with that is that if you have one working spouse and one non working spouse or one high income spouse and one modest income spouse, they’re going to have different size accounts, particularly retirement accounts. You know, one of them’s maxing a 401 ks for 30 years and one of them is not. Maybe they’re funding an IRA, but it’s, it’s dwarfed. And so if you allow title to govern during a an extended marriage, that really is harmful to the the the less working spouse. But title governance is not something I see in a lot of prenups.

Eric Brotman [00:10:31]:
Most of the time, what I see is almost a compromise upfront. Like we’re going to come up with not an allowance because that’s sort of an uncomfortable idea, but we’re going to come up with a division of certain property and make sure that that we’re both okay. That’s really what it’s about. It’s I love you enough to marry you. I will make sure you’re okay, even if we’re no longer in love someday. And while I can’t possibly fathom that that’s possible, it does happen. So let’s be prepared for the possibility that for whatever reason, we’re no longer feeling what we’re feeling right now, and let’s make sure we’re both okay. We’ve taken care of each other this far.

Eric Brotman [00:11:04]:
We’re gonna take care of each other for the rest of our lives one way or another even if we’re not married.

Jamie Lima [00:11:09]:
Yeah. And dividing so dividing up assets also brings up another problem, taxes.

Eric Brotman [00:11:15]:
Oh, yeah.

Jamie Lima [00:11:16]:
How what are some of the things you’ve talked with your clients about? What are the things that some of our listeners need to understand relative to taxes and dividing up these dividing up these assets?

Eric Brotman [00:11:25]:
People need to understand that a dollar is not a dollar. And what I mean by that is different kinds of accounts have different levels of spendability on them. A dollar in a in a traditional 401 ks or IRA hasn’t been taxed yet. So that dollar is a dollar with a mortgage. Whereas a dollar sitting in a savings account is a full dollar. It’s there is no tax liability on that. So you don’t just split it down the middle and say, all right, you get X dollars and I get X dollars. They have to be X dollars net of whatever tax burden is waiting for them.

Eric Brotman [00:11:56]:
And that could be capital gain. You know, you could have mutual funds that you all bought as a married couple that have a $200,000 gain in them. You have to allocate not only the shares, but also the basis of those shares. And that requires some accounting. Normally, if an account is being split down the middle, the basis would be half and half, which is a very fair way to do it. But if you decide to do it another way, what you don’t want to be is the spouse who allows the other party to dictate which assets go to you and which assets go to him or her. Because if there’s a half $1,000,000 account and $300,000 of it has no gain and 200,000 of it has a gain, it’s tripled. You want to make sure that it’s not just, hey, you get 2.50 and I get 2.50.

Eric Brotman [00:12:36]:
It’s not the same because there is no step up in basis at divorce. In other words, if you retitle that asset into one name, the basis remains the same. The tax liability upon sale remains the same. So a dollar is not in fact a dollar. It’s a dollar less capital gains. And the same thing’s true with IRA assets. There are other types of things. You know, people look at an estate and they look at death benefits, for example, on life insurance.

Eric Brotman [00:12:58]:
And a lot of times that’s included in a taxable estate. Well, you can’t consider the death benefit of life insurance one of the assets when you’re calculating a split. That’s not to say life insurance isn’t used in divorce. It’s used a lot of times in divorce, especially if there’s kids where you have to maintain a certain amount of life insurance for your spouse or former spouse for some period of time. That’s incredibly common. And sometimes that’s an existing policy. Sometimes it requires new underwriting if you can if you can do it. But you can’t count the death benefit as part of what one party is getting or the other party is getting.

Eric Brotman [00:13:29]:
It’s a totally separate thing. It’s not here now. You can’t use it to pay the mortgage.

Jamie Lima [00:13:33]:
Yeah. The as far as the insurance goes, what you’re talking about is is putting protections in place to not only to cover the the, like, support payments, things of that nature. Is that what you’re talking

Eric Brotman [00:13:45]:
about? Yes. Absolutely. Or the offset of a pension. You know, if you, if you’re a state employee and you have a pension plan, but it doesn’t kick in until you’re 65 and you die when you’re 53, there is no pension and there’s no survivorship on that pension. There might be a small death benefit, but there’s no income forever. If you take that income at 65, now you can set it up with joint and survivor benefits for married people, or you can set it up under what’s called a QDRO, which is a domestic relations order, which allows some portion of that pension to go to your former spouse. But it won’t exist if you die before you elect your pension. And so if, if you’re counting on your ex husband or ex wife who has a pension to make sure that some of that’s coming your way, you have to have enough life insurance to offset that, at least until they they flip the switch and retire and start the pension income where it may not be there.

Jamie Lima [00:14:37]:
Yeah. It’s an awesome tip. So for those of you that are listening that like you wanna rewind and listen to that again, because every case we work on, one of the last things we do before we let anybody sign off on anything is to ensure that there are clauses in the documents related to the insurance to cover support and things like the pension. Because if you pass away before those stream of income kicks in, in some cases that’s going to cause a major, major issue and could derail the entire financial plan that we’ve put together for you. So that’s awesome, awesome tip there. In that same vein, let’s talk about estate planning. It’s one thing that I’m super passionate about as a certified financial planner and the work I do in that wealth management realm, make sure all of our clients have estate plans in place and so on. So maybe just give us a brief snapshot for the listeners that don’t really understand what that involves, what that looks like, and then how beneficial it can be and some of the some of the things you wanna consider relative divorce in that area.

Eric Brotman [00:15:34]:
Well, general estate planning for most families or most couples is 4 documents for each adult spouse. In most cases, you have a will and people sort of intrinsically know what a will is or instinctively know it’s a, it’s a document to, you know, divide your stuff if you die, but there’s much more in a will than that. It names guardians for your children. If you have minor children, it names trustees to take care of money you’re leaving to a 7 year old who isn’t prepared to manage that naturally. There are other roles in terms of who’s responsible for what in the will. So it’s more than just where does my stuff go? In addition, there’s a durable financial power of attorney. The power of attorney allows someone to step into your shoes and handle financial matters for you. For married couples, a lot of times you allow your spouse to do that immediately.

Eric Brotman [00:16:19]:
And there’s lots of reasons why that’s a great thing when you’re married. And of course, it’s revocable. So if you’re getting divorced, one of the things you want to let your attorney know is to invalidate the power of attorney document so that you don’t accidentally have an estranged spouse go drain your account, which legally they could if you don’t take that step. So that’s a big, a big change for divorce is to nullify the financial power of attorney. The other two documents, one is a living will, and one is an advanced medical directive. And some attorneys combine them into sort of part a and part b and some do separate. But at the end of the day, what you’re doing is you’re stating your wishes in the event you’re in a vegetative state or something terrible has happened to you. You’re naming your wishes.

Eric Brotman [00:16:56]:
And then you’re also naming the person who can speak to a physician on your behalf. That at divorce, you might say, you know what? My ex wife is still the best person to talk to about that. And that’s up to you. Or you might say, I’m naming a sibling. You can redo those documents whenever you want to. When you have a will and you’re and you’re alive and well, the will does nothing until you die. The power of attorney and health directive are only active while you’re living. So those are documents that if you were to pass away, they become invalid anyway.

Eric Brotman [00:17:25]:
When you’re looking at divorce, a lot of times there’s a separation agreement. And a lot of times that’s then followed by a divorce decree that becomes part of your legal, which I would argue is part of your estate plan as well. Whether it’s considered an estate planning document by definition or not, I think is immaterial, but it is part of your legal world at that point. And you’re going to have to potentially either make, an amendment to your will, which is called a codicil in most places where you amend the will to, to accept the language in the divorce decree. Like we talked about, the will might say, you know, we’re leaving certain property to this person up through the age of majority for our son, for example, after which that’s a non issue. So those things will happen. And upon divorce, you are going to want to look at doing new estate planning at some at some level. The first thing to do, though, is to invalidate the financial power.

Eric Brotman [00:18:15]:
You don’t want your former spouse, you know, in your in your bank account. You really don’t.

Jamie Lima [00:18:20]:
And then that’s the same for retirement account, beneficiary status and things of that nature.

Eric Brotman [00:18:24]:
Beneficiaries beneficiary status is a little different because once you are not legally married, you do not have to have a spouse as a beneficiary under a 401 ks or most qualified plans. If you are married, your spouse must be your primary beneficiary unless he or she signs off that it’s okay not to be in front of a notary. That is true of a 401 ks, a 403 b, a certain other types of plans. It’s not true with an IRA. So if you have an IRA, you can name anyone you want and so can your spouse. I think doing a beneficiary designation inventory is a wise thing to do anyway. People should do that tomorrow. You know, that should happen anyway because there’s so many mistakes.

Eric Brotman [00:19:04]:
We see people who don’t have a beneficiary named. We see people who named their firstborn child, but they’ve had 2 more children and they never updated it. And at some point, that’s an issue. So I think reviewing your beneficiary designations, reviewing your asset titling, there are lots of different kinds of joint property. Some are community property, some are, you know, in, in Louisiana, they have a totally different set of, of rules for, for property. In other places, it’s just different forms of tenancy. Joint tenants with rights of survivorship, tenants in the entireties is allowed in some states and not in others. Tenants in common, which is separate interests.

Eric Brotman [00:19:38]:
And I don’t want to get off on legalese, so I apologize on, on the tangent. But just because both names are on a statement does not mean it’s equitably and totally owned by both parties. There are lots of different ways to title assets jointly. If you own a home together, you’re going to want a new deed for that home deciding on who’s receiving it, unless you’re both going to own it until it’s sold. In some divorces, the title doesn’t change. Maybe the mortgage doesn’t even change. It’s being paid under the divorce decree by 1 or both parties in certain percentages. But you may not have to retitle the house.

Eric Brotman [00:20:10]:
It might not be settled until the house is sold 18 years later. I mean, that is a reasonable thing. In certain cases, it depends how ugly the divorce is. Is it acrimonious? Like you can’t wait to trip this person in traffic or is it, you know what? We fell out of love. It happens, but let’s, let’s not hurt each other. And I don’t know about you. You know, Jamie, I know you’re a mediator. I don’t know if you do if you do collaborative divorce.

Jamie Lima [00:20:36]:
We do.

Eric Brotman [00:20:37]:
Collaborative divorce, in my opinion, is the single best way. If there is such a thing as a good way to get divorced, collaborative divorce allows everyone to be at the table without confrontation, without having it be me versus you. It can be us figuring this out. And a mediator who can do collaborative divorce can help everybody not hate each other, at least not as much at the end of the day. It’s a it’s a major deal because if you’re both hiring attorneys and if you’re constantly fighting over the scraps of what’s happening here and there, the only person who’s making out there is the lawyer. They make a fortune. The uglier the divorce is, the more money the lawyers make, the less money is being split by both spouses. So to find a way to not spend a $100 fighting with each other puts $50 in each of your pockets as far as I’m concerned.

Jamie Lima [00:21:25]:
Absolutely. And I’m a firm advocate for that. And that’s why I do the mediation work. That’s why I do the work that I do, because my divorce, unfortunately, still carries on even to this day. It’s never going away, especially And we’re $75,000 into a divorce that I finalized 7 years ago. It’s total nonsense. It shouldn’t be that way. It is not in my own doing.

Jamie Lima [00:21:49]:
That’s for sure. But it just is what it is. And if we can try to help people avoid that, and like you said, remove the confrontation, get this through either mediation or a collaborative process. We’re actually gonna do a whole show on collaborative divorce here coming up soon, which listeners should bookmark and follow and like and all other stuff so they can get updates on that. But more to come on that, but I’m a firm believer in that. Because you’re absolutely right. If you have spent $100,000 on attorneys, and to your point, that could have been 50,000 in your pocket, 50,050 in the other party’s pocket. Yeah.

Jamie Lima [00:22:22]:
That’s a huge impact on not only your current financial situation because life after divorce is gonna be completely different, especially at least at the outset. Right? Like, you can rebuild and you can grow in your career and and so on and so forth. But day 1 of your newfound single life, your your financial situation is totally different than it was the day before and the Yeah. Right? So let’s talk about I mean, let’s we I I’m kind of alluding to this, but the the kids. Right? Like, what are some of the what are some of the things that we need to be thinking about relative to the kids? No one is the estate planning, so we maybe wanna come back to that. But college planning, future financial planning, what’s let’s talk about the impact of the kids.

Eric Brotman [00:23:00]:
Before we talk about any of that, Jamie, we have to think about the impact that divorce has on children to begin with psychologically, mentally, emotionally. Because the damage that’s done to kids when their parents split does not mean that parents don’t sometimes split for the right reasons. You know, there are plenty of reasons why it’s still better for everybody in the end. But no matter how amenable everyone is, this is a death in the family for the kids and a completely different life. I was 12 when it happened to me. You had mentioned that it happened to you in a similar age, and it does change the landscape. And so the first thing that I think both spouses need to do is do everything in your power, not to pit the kids against each other or against the other spouse, not to share adult dirty laundry with teenagers. That’s not helpful.

Eric Brotman [00:23:51]:
Or even grown, you know, adult children. And to put their needs at least on par, if not first, so that they don’t have to witness this. They don’t have to go through the adult experience that the adults are having. So let’s start there.

Jamie Lima [00:24:05]:
Yeah. A 100 percent.

Eric Brotman [00:24:06]:
In terms of the logistics, you have to figure out a lot of things. You have to figure out where the kids are going to live. How old are they? Is there a daycare scenario? Are there benefit scenarios? Are there public school scenarios? Are you in different districts? You have to agree in the divorce decree who’s going to handle, for example, the payment for college. Because in some states, 18 is the age of majority and a parent can say, Hey, you’re on your own. We’re doing nothing. In other states, it’s 21. In a divorce decree, you might say, you know, I’m going to continue to support where we’re going to pay some percentage of education up to X dollars or for X number of years. Maybe it’s 70, 30, not 50, 50, but that’s how we’re going to handle it.

Eric Brotman [00:24:47]:
If there are 5 29 plans or other college savings plans, often they’ll be referenced in a divorce decree in terms of which ones will be used first. They don’t necessarily have to be retitled initially, but it might be required that your former spouse becomes the successor owner of that plan, for example, so that if I drop dead and I have a minor child, that child doesn’t inherit that 529, but my former spouse does for that child’s benefit. And what we don’t want to do is we don’t want to leave the money directly to kids because all it’s going to do is mess up their financial aid profoundly. You don’t want the kids to ever own their own account. Custodial accounts, if you have any shot at financial aid, do not have accounts in the kids names, period. Have accounts for their benefit, have accounts earmarked for them, have accounts where they’re beneficiaries. But for Pete’s sake, don’t put money in their name because every dollar in their name is a dollar less financial aid. You’re literally saving their future college money.

Eric Brotman [00:25:44]:
So there’s that. In terms of other sort of tips around around assets and around you mentioned the estate planning. Yes. You’re gonna make some changes to that. But some of this is about also about custody. I I mean, for Pete’s sake, I don’t know anyone who says, you know, I want to be a Wednesday and every other weekend dad. What a tragedy that is. And to fight over that and to be like, no, I want Thanksgiving.

Eric Brotman [00:26:08]:
You can’t have Thanksgiving. Destroys it. And someday these kids are going to grow up and they’re going to potentially get married and start their own families and have kids. And how many birthday parties do you have to have if you can’t get along to show up at your 3 year old grandson’s birthday party? Like, shame on you at some point. Yeah. So a lot of the divorce stuff is financial, but so much of it is emotional and relational. And somehow in the back of your mind, while you’re angry at this person, for whatever reason, whether he or she did something wrong or whether it just didn’t work, while you’re angry at this person, somehow you have to muster the courage and conviction to say, I used to feel differently about this person, and this is not the way that me would have treated her or him. That’s hard to do.

Eric Brotman [00:26:52]:
Yeah. It’s emotional. It’s hard to do. But if you can do it and if you can mediate and if you can be collaborative and if you cannot ruin every holiday for the rest of time, then you’re not putting your kids in a position where they have to choose. I’ll tell you a story, Jamie. When my folks divorced, this is God’s honest truth. I was it was the summer after 6th grade. And it’s one of those moments you remember.

Eric Brotman [00:27:14]:
You know, you remember where you were on 9/11. You remember where you were when the space shuttle blew up. You remember certain moments in life. People remember where they were when they heard about John F Kennedy. The day I found out my parents were divorced, I remember where I was sitting. I remember everything about that instant. And it’s been 40 years. And I remember my father and his infinite wisdom approaching us and saying, your mother and I are getting divorced.

Eric Brotman [00:27:35]:
Who do you want to live with? I said, God, I can’t make that up. And my 12 year old self, and I had a younger brother, still have a younger brother. My younger self had the gumption to say, are you selling the house? He said, no. I said, well, then we’ll stay here. You guys figure out who’s staying with us. So help me. That was my 6th grade self.

Jamie Lima [00:27:54]:
Wow.

Eric Brotman [00:27:55]:
I didn’t want to be separated from my brother. I didn’t want to give up my neighborhood, my friends, my anything if I didn’t have to and let them worry about it. Yeah, I literally threw it back at them. Like, what do you mean? Who do we want to live with? Well, what are the parameters? You know, and and that was it’s so important to message this to the kids appropriately so that they don’t feel like it’s their fault, which, by the way, they’re going to think it’s their fault anyway. They are. They’re going to say, oh, what did I do? Or how could I done this differently? Or I wish I hadn’t given them a hard time at dinner last Tuesday. Like, it’s not about that. It’s never about that.

Eric Brotman [00:28:26]:
But kids can’t process. They don’t know what’s going on behind closed doors. They don’t know what went on before they were born even. So it’s an incredibly difficult thing. But messaging it right matters and figuring out that the living situation matters. I never, you know, and my mom stayed with us. My brother and I stayed with my mom for a number of years. And then 4 years or so later, she moved out and my father moved back in.

Eric Brotman [00:28:48]:
We never moved. We literally never moved. They swapped. She moved out, he moved back in. We had, we had time with each parent 1 on 1 for a period of years. And that was that. And it was functionally, it was fine. It was all, it was strange, but it was fine.

Eric Brotman [00:29:02]:
Everybody made out okay. And that was that was the best way I know of to do this. Some people talk about nesting. You’re familiar with the nesting concept, this idea that you keep the house and the kids stay there and sometimes dad’s there and sometimes mom’s there. And then mom and dad each have another residence to go to where the kids don’t have to feel like, oh, I’m in dad’s apartment right now, which nobody wants to go to, by the way. Yeah. Yeah. Nobody wants to go to their their dad’s apartment.

Eric Brotman [00:29:28]:
They got their friends, their bedrooms, their stuff, their routine, everything. So they nest. And now you’re paying for 3 residences instead of 2. 2 is bad enough. Imagine everything doubling. Imagine now you have 2 electric bills and 2 this bill and 2 that bill and things aren’t pooled anymore. It doubles certain expenses. Divorce is so unbelievably expensive.

Eric Brotman [00:29:51]:
And that’s before you’ve paid the lawyers and fought with each other.

Jamie Lima [00:29:54]:
Yeah. That’s and that’s where the value of financial planning comes in. Right? And that’s that’s why we I think you and I and and a lot of really good, you know, advisors out there do the work that we do because we recognize the the real value in this. It unfortunately, the work that we do is very intangible. Right? I mean, I guess you could you can print up a 100 page financial plan, and somebody can actually hold it in their hands. But 9 times out of 10, it just sits there and collects dust on a shelf somewhere. So we don’t even do that anymore. It’s all at least everything’s digital.

Jamie Lima [00:30:22]:
But you’re absolutely right. This is where the rubber meets the road and the work that we do improves that, like you said, there’s 2 of everything now. All your expenses are now doubled. And that money that used to be thrown in the center of the pot, so to speak, and into the pot and everybody, you pay bills and then whatever’s left over, you get to save or spend or whatever. That’s all changed. That’s all changed. So the work that we do as CDFAs is obviously focusing on the here and now and how to make really good decisions through the divorce. So you’re not jamming yourself up moving forward.

Jamie Lima [00:30:56]:
But that’s where working with someone like you and someone like myself moving forward, people can really benefit because once the divorce, the dust is settled on the divorce, you’ve got to figure out the rest of your life and it impacts the kids and so many decisions you’re gonna have to make along the way. But hey, man, this conversation has been amazing. I think anybody that’s listening to it should put this thing on repeat because you had so many nuggets of just knowledge and amazing tips and things to consider and so on. So I’m super appreciative of it. I know you have this book that you wrote. It’s a best seller. Anything you wanna share related to the book? Any any final words of of of wisdom that you you have to share? Blank check.

Eric Brotman [00:31:39]:
Wow. Blank check. I do like those. 1st, shameless plug. This is the book, don’t retire graduate, available on Amazon or any place you buy books. There’s also a workbook with it, which for folks who either aren’t ready for a financial advisor or don’t know if they want to pay a financial advisor, it will create a financial plan for you. You can go through some exercises. I don’t believe in homework.

Eric Brotman [00:31:59]:
I don’t know about you, but as a kid, I didn’t like homework, but I always did extra credit. So every chapter has an extra credit assignment. And if you do them all, you will have a financial plan and it will involve your accountant and it will involve your attorney and it will involve debt reduction and banking and insurance and all these different things. But you will literally have built your own financial plan very, very easily and very inexpensively. And then you can decide when it’s time to also get some professional advice. Because frankly, folks like Jamie, folks like myself and our, our teams and our firms, we really are accountability partners. And, and, and we really do. It’s kind of like having a trainer at the gym.

Eric Brotman [00:32:32]:
We all know how to do pushups, but if somebody isn’t saying drop and give me 20, I don’t know about you, but I might not. If I have an appointment with my trainer, I go. And if I don’t, I got 50 things I’d rather do than work out. It’s just true. So the accountability of it becomes helpful. So for more about our white papers and our podcast episodes and all of the media, including some free online courses, folks can go to brotmanmedia.com and see a whole library of information. Most of it’s free. And, and I hope it helps a bunch of people.

Jamie Lima [00:33:00]:
Hey, man. Thanks so much for sharing that. I mean, it’s it’s great to see that other advisers are trying to do good work and share as much free information, as much information as possible, to help people along along the way. So I’m super appreciative of it. Don’t worry if you’re driving, if you’re listening and you can’t jot this information down, all this information is gonna be in the show notes. So, you know, we’re just, you know, follow, like, subscribe, do whatever you have to do to make sure you you stay tuned and get access to more information. And as more episodes come out with amazing guests like this, you’re in the know. So thanks again, man.

Jamie Lima [00:33:32]:
I appreciate your time today. Thanks for listening, and we’ll see you again soon.