Interview Questions for Impact Makers Radio Show – Divorce Series 01, 2017
Mary Salisbury, Certified Divorce Financial Analyst
Question: Can you briefly describe the people you serve and the kinds of situations they find themselves in when they come to you for help?
What I tell people when they ask me what I do is that I help people have a calmer, less stressful, more affordable and financially smart divorce. My goal is to attract those who don’t want the divorce to be an expensive court battle and who are able to be reasonable. Usually, my clients have been married at least ten years and have intertwined assets AND debts and now need to find the best solution for dividing them up. In some situations, they are able to work amicably and in other situations they are working with an attorney because they are in the weaker position of having to fight for what is fair and equitable. Their financial picture does not need to be complex to benefit from my advice. There are many avoidable pitfalls which I think more than justify my affordable fees. Ideally I want clients to find me early in the process, because the whole process makes people, even those with significant assets, feel poor, and if they are too far into the divorce and they have already spent significant attorney fees they feel too broke to consider bringing in another professional, even though my benefits outweigh my costs.
Question: What’s the most common misconception?
People think that they have 2 choices: either get an attorney or go through a divorce without any guidance and do it themselves. The longer I do this the more I see how the system in this country has for the most part failed to provide anything but a legal and adversarial system to structure a divorce settlement which for the most part is a financial settlement. I do advise my clients to know their legal rights when it comes to divorce and I will provide them with various options to get a free or inexpensive consultation and I also advise my clients to have an attorney draw up the legal papers after I have guided them toward a settlement solution that works for them. But I know from experience after divorcing after 26 years of marriage that attorneys do not financially analyze divorce settlements. Clients think that attorneys are going to give them financial guidance but what I see happen is that they leave it up to the clients to decide and its not until years later the clients find out the mistakes that they made. I don’t mean to badmouth attorneys because they have their role but their dominance in the divorce arena is misplaced in my opinion.
So I always ask people why they think it make sense to hire an attorney to structure a financial settlement. I have sophisticated divorce planning software that attorneys don’t have. Attorneys don’t have the specialized financial training or in many cases much financial knowledge at all. Sadly many attorneys are just creating a fight for which side can get the most while raking in hourly fees. Clients are kept in the dark which adds months or even years of stress and have no idea what the settlement will look like for them down the road, particularly after the spousal or child support ends.
Question: Give one example (case study) of how you’ve helped someone you work with to overcome the above misconception and what results they were able gain.
I can give you a mildly complex but not an atypical case. I had a couple, married 18 years, 2 kids. Prior to being married, both had government jobs giving each a decent pension. The wife stayed at home for a period while the children where young, putting a hold on her career. Both now work in the private sector. I met them after they had separated and the wife was still in the marital home and the husband was renting a home. This couple was trying to work though the divorce amicably but figuring out how they could each purchase a home with the sale proceeds of their existing home, divide the pensions, a 401(k) and an IRA, some credit card debt and student loans plus determine child and spousal support was too complex for them to handle. I met with each party to understand their post-divorce goal and after they gathered and provided me all of their financial documents and budgets, and put all that information into my specialized family law software and came up with some options that seemed like fair starting points and we hashed it all out in a couple of meetings. Then I drew up settlement points which they took to an attorney to draw up the legal paperwork. So for about half of what many attorneys ask for as a retainer, their divorce was completed, and the process was pretty quick.
What an attorney would not have done was provide easy to understand charts showing them both the long term consequences of the proposed solutions. I could easily compare “what if” scenarios by just changing a few entries in my software. All of the data takes into consideration the tax implications and adjusts for inflation or appreciation. I am also able to calculate present values of spousal support which I think is important because in my state a woman loses spousal support should she remarry, which I think holds women hostage. In this case, the wife ultimately received more than 50% of the marital estate but I was able to show the husband, who had a substantially higher income, that he would still have substantial net worth in retirement and it made it much more acceptable to him. I don’t know if I could go so far as to say they are friends but they didn’t become enemies in the process and I think they will be better parents and be able to move on with their lives. I think the reports I am able to generate and the guidance I give keeps it real instead of emotional.
Question: What is one unknown pitfall they might not, but should be aware of?
The marital home, which is usually the biggest or one of the biggest assets, has the most pitfalls associated with it. Especially for the woman, there is a lot of emotional connection and perceived stability. She doesn’t want to uproot the kids and cause more emotional distress. But a home, while it is an appreciating asset, is illiquid and can end up draining your net worth. I meet a lot of women who what I just said describes them exactly and now years down the road they regret keeping the home. I sometimes have to be the bad guy and advise the woman that she really should not keep the home.
Also the tradeoff of home equity with an equal dollar amount of other assets, may look equal at first glance but after applying taxes, capital gains, cost of sale, etc they can actually be very unequal assets.
The marital home is a big cause of why after divorce woman end up with a low standard of living. No one is pointing out to them the long term implication and I want to help people make smart financial decisions.
Question: What would be your best piece of advice/tip to the listener?
If you have been married for 10 years or have maybe $100,000 in net worth, don’t go to attorney first. Come to me first (and I give free ½ hour consultations) and we can explore what role I can serve in your divorce process. I’ll help the divorce stay amicable or at least civil, I’ll save you money and time and I will recommend good attorneys who aren’t there to stir the pot and rake in the fees. I think people will end up with a better solution at a much lower cost plus they have a good idea of what their financial future looks like.
Question: Could you briefly tell us a little about yourself in terms of background, education and experience as it relates to the main topic of your tip?
I graduated from the University of Miami with a degree in economics and then the next 11 plus years as an ERISA paralegal, which means I specialized in employee benefits and retirement plans. I earned the designations of Certified Pension Consultant and Qualified Pension Administrator and that knowledge helps me help understand and separate retirement plans, and executive compensation plans which are common with high net worth individuals. Attorneys admit to me that those documents are greek to them so I’ve become a valuable resource to the attorneys in my area.
After that I worked with my ex-husband managing his bankruptcy trustee practice where we managed the bankruptcy estates of every imaginable type of business. I gained a lot of various legal and business knowledge and that helps me understand a wide variety of businesses, particularly when it comes to the self-employed.
I already mentioned I was divorced myself and by the way between us both we spent $20,000 in legal fees and ours what not all that highly adversarial, at least from my end. It did take place in California where attorneys regular bill $350 per hour.
After divorcing I became a financial advisor and got my insurance licenses as well as series 6, 7, 63 and 65 registrations. It was during that time that I got my Certified Divorce Financial Analyst designation and I started to see the huge void in the divorce niche as far as advising clients how to divide a marital estate in a financially smart manner. This has particularly become important now that there are all these grey divorces where people married 20, 30 or more years are getting a divorce. Even though the CDFA designation has been around for something like 20 years it is still not well known, so I am having to educate both family law attorneys as well as the public on what I do and the fact that this service is missing, at least in my geographic area. Filling this void became a huge passion of mine and my goal is to change the way divorces are approached.
Question: How people can connect with you?
My business is The Right Divorce Solution so my website is therightdivorcesolution.com and I can be reached at firstname.lastname@example.org