Tracy Callahan: Welcome to Divorce Coaches Academy podcast, where we explore the role of divorce coaching in conflict resolution, decision making, and navigating divorce with clarity and intention.
Debra Doak: Welcome to the DCA podcast. Today we're going to tackle a topic that can feel really overwhelming during divorce, and that's money. We all know financial decisions made during divorce can have consequences for decades. Yet so many people enter the process without fully understanding their assets, their living expenses, how retirement accounts work, what the tax implications are. What their life's really gonna look like. So we're gonna talk about the importance of financial literacy, talk about how to evaluate settlement options, we're gonna talk about the common mistakes people make, and what somebody can do to improve their financial confidence during divorce. So today I am joined by a special guest, Alyssa Miller. She has a ton of letters after her name. We'll talk about that a little bit. She's a private wealth advisor with Feldmauter Financial Group. And co-founder and managing director of Alternative Divorce Solutions, which is a Dayton-based practice she built with her dad to help divorcing clients gain financial clarity, whether they're mediating, doing collaborative divorce, or they're litigating. So, Alyssa, I'm glad you're here. I'm gonna go through some of your titles real quick so people can understand you know what you're talking about. Alyssa is a certified financial planner. She's a certain Personal financial analyst. she's a certified divorce coach. She's a certified long-term care professional, a certified divorce financial analyst, blosh, all the things. She's even served as a national board member for the Institute of Divorce Financial Analysts, which is where I got trained, is that's where the CDFAs get trained, right? And she's spoken nationally, presented to the Bar Association, et cetera, and focuses most of her work on helping clients understand. where they stand financially, how they can evaluate those settlement options, and most importantly create a realistic plan for their life after divorce. Whew, Alyssa, welcome to the podcast. Did I catch everything?
Alyssa Miller: Yeah, you nailed it. Thank you for having me.
Debra Doak: Yeah, we're so happy you're here. let's start off with this. Why is financial literacy such a critical part of navigating divorce? And then let's talk about some of the common mistakes you see people make.
Alyssa Miller: Yeah, well we could definitely we we could talk all day about that. And I I definitely do we have plenty of discussions about this topic for the community because unfortunately, so much of the time we see things on the other end after it's too late, after something's already been agreed to. And,
Debra Doak: Right.
Alyssa Miller: you know, at that point it is what it is, and we move forward and we make it work, but there's so many times where we look at something and say, if we would have just done this slightly differently, or if Different decisions had been made, or if they had had information at the time, we may have been in a better position to, you know, negotiate or to understand the long-term ramifications of a settlement offer.
Debra Doak: Yeah.
Alyssa Miller: and financial literacy from that standpoint, I mean, I just feel is so important because still in so many families that we serve, it tends to still be one person has a little bit more knowledge or a little bit more dominance in handling this subject than the other.
Debra Doak: Yeah.
Alyssa Miller: So much of the time we see maybe one party is helpful in paying the bills and managing the day to day, maybe keeping an eye on the budget, you know, kind of cash flow in and out, but that same person doesn't always have the same insight into the investments and, you know, some of the broader picture on things. those roles, you know, sometimes are are shared, but a lot of times are still siloed for couples. And so when you're put into a position, you know, having to evaluate these things and not having been that person. it can be very
Debra Doak: Right.
Alyssa Miller: overwhelming and cause a lot of angst.
Debra Doak: Yeah, I agree. I agree. What financial information would you say most people don't understand when they're coming into this divorce process?
Alyssa Miller: Yeah. depending on their comfort level with finance and understanding the investments that they have, a lot of times it's just some basics in terms of understanding what the different assets that they are, how they're taxed, how their long term consequences of being able to pull money out of them and when from when we look at things from a liquidity standpoint, and you know, what is the value of one asset over another. A lot of times there's an emotional tie to an asset, right? Specifically real estate, a lot of times.
Debra Doak: Yes. Yeah. And we're gonna talk about that for sure. Yep.
Alyssa Miller: Yeah, and that can tend to be, you know, challenging because we have memories associated with a place or a thing that people sometimes gravitate more towards as opposed to, you know, money in an account, whereas, you know, depending on the scenario, may make a drastic difference for long term.
Debra Doak: Yeah, I agree. I agree. let's talk about you've got somebody who doesn't understand the finances. Maybe their spouse took care of all of it. They just kind of ran the household expenses through a joint credit card and they didn't worry about it much. And now here they are and they're embarrassed. I hear that a lot. Like, I'm so embarrassed. I didn't have a better handle on this. How do you approach those clients or how do you work with them?
Alyssa Miller: Yeah. I hear that a lot too in the work that we do. And you know, what I always tell clients or people that come in to have discussions with us is there's nothing to be embarrassed about. You know, we all have different roles. we all have different strengths, right? In my home, I don't do any of the cooking. I'm an awful cook. When we are when my husband's out of town, we do take out because
Debra Doak: Okay.
Alyssa Miller: that's not my role. you know, and that's okay, right? We all have our our strengths and we have areas where we excel. And it is what it is, but at this
Debra Doak: Mm-hmm.
Alyssa Miller: point, it's really important to take a little bit of a step back and to say, let's get educated on some of these pain points to be sure
Debra Doak: Yeah.
Alyssa Miller: that we maybe we can't get you fully to equal footing, but we can surround you with experts or people who have the knowledge to be able to help and fill in those gaps where people are uncomfortable. And ultimately
Debra Doak: Yeah.
Alyssa Miller: we typically find that. A little bit of information goes a long way in terms of, you
Debra Doak: Mm.
Alyssa Miller: know, increasing confidence in the set.
Debra Doak: Right. Yeah. I mean I like to use the word yet. You don't understand it yet. You don't feel like you have a grasp on it yet, but it's figure outable, right?
Alyssa Miller: Yeah, exactly.
Debra Doak: Yeah. I'm sure you see this too. I have a lot of people come in and the word that's on their mind is fair. I want
Alyssa Miller: Mm-hmm.
Debra Doak: to get what's fair. I want to get what I'm entitled to, which doesn't always incorporate thoughts about long-term financial stability. So how do you help clients shift from thinking about what's fair today to thinking about is that workable for tomorrow?
Alyssa Miller: Mm-hmm. Yep. agreed. We we get that a lot as well. And when I speak publicly about this topic, one of the big categories of things that we discuss with people is having to get past the concept that fair and equal are the same thing. Because they're not. you know, something that is equal, you know, fifty fifty, just draw a line down the page and split everything in half, may not necessarily be fair. Because income
Debra Doak: Mm-hmm.
Alyssa Miller: is different and our our credit may be different and our ability to be able to handle certain expenses may be different. you know, so that may be equal, but it might not necessarily be fair.
Debra Doak: Mm.
Alyssa Miller: so it is a very difficult concept. we also have you know have seen a lot of clients get really concerned about past financial decisions that were made. And feeling like that needs to be rectified during the divorce process in some way, shape, or form. for example, you know, my husband put a bunch of money into XYZ stock and it just tanked. And I feel like I should be able to get some of that money back. Unfortunately,
Debra Doak: Yeah.
Alyssa Miller: some of those things, there's nothing we can do about it, right? That money's gone.
Debra Doak: No.
Alyssa Miller: It was spent, it was invested improperly, whatever the case may be. Now, extreme situations, a lot
Debra Doak: Sure.
Alyssa Miller: of times there may be an avenue for An attorney to be able to get involved to be able to make an argument about that. But generally speaking, it is what it is at that point. And we have to have a lot of conversations with people to say we are where we are. How
Debra Doak: Yep.
Alyssa Miller: we got here usually doesn't matter unless there
Debra Doak: Mm-hmm.
Alyssa Miller: was you know fraud or you know something really drastic that got us there. and so now we just have to look at how do we take the information we have and move. How we make the best situation out of what we have today? And a lot of times that comes down to trying to set aside the stress of what's going on now and be able to
Debra Doak: Mm-hmm.
Alyssa Miller: look forward and say, what is it that you do want after this? And sometimes it's easier, we find, for people to figure out what they don't want. Right.
Debra Doak: Mm-hmm.
Alyssa Miller: So having those discussions to say what is the game plan? Right. If if it was a stay at home parent that we're speaking with, you know, what sort of education do we maybe need to be able to get you back up on your feet? What sort of jobs do you think you would be able to qualify for? What is that income gonna look like? Right.
Debra Doak: Mm-hmm.
Alyssa Miller: we have a lot of conversations with people about housing and you know, what is the game plan?
Debra Doak: Yeah.
Alyssa Miller: do we wanna keep the kids in the same school district? If so, you know, what are what options are available and what can we afford?
Debra Doak: Does it make sense to buy? Does it make sense to rent? Right. We're running all those scenarios
Alyssa Miller: Mm-hmm. Yeah.
Debra Doak: with them.
Alyssa Miller: Yeah. And so in sometimes that is difficult for people to do, especially in an emotional state where there's just a lot of chaos going on, which is completely understandable.
Debra Doak: Mm-hmm.
Alyssa Miller: But if we can get people to self regulate and to be able to say, let's look towards the positive in terms of what your next phase of life is going to look like, you know, what do we need to do to be sure that those goals can be achieved, whether it's short term or long term?
Debra Doak: Mm-hmm. Right, right. So we're talking today about financial literacy. And somebody comes in, they don't know. The first thing I think I do and you do is we talk about gathering documents, right? Because we need to know what's on the table to be divided. We need to know what we have so we can educate our clients about it. So can you just briefly run through? I know the list is long, but briefly run through what kind of documents Coach could work with their clients together or people that are going through divorce listening. What would you encourage them to go look for first? What are they going to pull together?
Alyssa Miller: The easiest things to try to get to first is anything that you personally have access to, right? So bank
Debra Doak: Mm-hmm.
Alyssa Miller: accounts, credit card transactions. And in this day and age, so much of that is available online, right? investment accounts usually are householded so that my login can see my accounts and my husband's accounts.
Debra Doak: Mm.
Alyssa Miller: so being able to get into some of those or organizations and institutions to be able to pull basic statements on.
Debra Doak: Yep.
Alyssa Miller: where are we today? So bank accounts,
Debra Doak: Right.
Alyssa Miller: credit cards, investment accounts, if you have access to your tax return or can get in touch with your CPA if you had one, to be
Debra Doak: Mm.
Alyssa Miller: able to get copies of that. There will definitely be documents, especially in a in in a situation where there's not as much collaboration, that you may not be able to get to.
Debra Doak: Mm. Right.
Alyssa Miller: And people get very flustered over that, I have found.
Debra Doak: Mm-hmm.
Alyssa Miller: of you know, I have no idea how much is in their 401k. I have no idea, you know, where it even is. And that's okay,
Debra Doak: Yeah.
Alyssa Miller: because at some point that information will come to light, whether that's voluntarily or not. yeah,
Debra Doak: Well. Mm-hmm.
Alyssa Miller: that's what the attorneys are there for, right? If we can't get it nicely, they'll subpoena it and they'll come up with the information.
Debra Doak: Right. Right. Yeah.
Alyssa Miller: Being able to collect as much information as people can is helpful. I also tell people to pay attention to their mail, although so much that comes now is comes digitally.
Debra Doak: Yeah.
Alyssa Miller: There are plenty of things that still come as a quarterly statement or a notice through the mail. So paying attention to the fact that do we get notices and information from Chase Bank? Do we get information from, you know, Wells Fargo or Yeah, yeah,
Debra Doak: Fidelity, whatever, yeah.
Alyssa Miller: absolutely. a lot of times tax returns tell a huge portion of that story.
Debra Doak: They do.
Alyssa Miller: So if people don't have access to it, we tell them at least get me your tax return because you had to sign it. you should be able to get access to it.
Debra Doak: Mm-hmm. Yep.
Alyssa Miller: and that tax return can tell me a lot of times exactly where everything is and we can help guide
Debra Doak: Mm-hmm.
Alyssa Miller: people to, you know, where those where we need to contact institutions.
Debra Doak: Right, right. And gathering all this information, I always say there we're we're accomplishing two things at once, right? One is the income and expense. What does it cost me to live? Because that is a big filter for decision making. And then there's what's on the table to be divided.
Alyssa Miller: Yes.
Debra Doak: What's the equity in the house? What's in the four one K, all that. But for people that don't have a lot of financial literacy, really eve they have no idea and it's good. practice to start helping them figure out what is it going to cost me on a monthly basis. Because I'll hear, I'm sure you hear this too, he told me I have to get a job. He told me I'm going to have to go back to work. And I'm like, do you right? That's your choice. We're going to look. And that might be a choice you make to say, yeah, I want to continue to get my hair done or I want to continue to go to this Pilates studio, in which case support isn't going to cover it or the assets you're going to get aren't going to cover it. And then that's going to be your choice, but we have to know that framework first, right?
Alyssa Miller: Yeah. Mm-hmm. Yeah. And we have found that budgeting is not a skill that a lot of people one enjoy doing. Right. It's
Debra Doak: Yes.
Alyssa Miller: it's it's not a super enjoyable activity. Right.
Debra Doak: Yeah.
Alyssa Miller: and it's not always the easiest thing either, especially in today's world where, you know, you a lot of things are digital and you know, we're not writing checks for things, we're not paying for a lot of things in cash. So it's not as in your face apparent in terms
Debra Doak: Mm-hmm.
Alyssa Miller: of what we spend.
Debra Doak: Right.
Alyssa Miller: and even sometimes what we make, right? So thankfully now with with that technology also comes some good to say there is so many really great budgeting apps that are out there
Debra Doak: Mm-hmm. Yep.
Alyssa Miller: to be able to say all you have to do is just connect your bank accounts into them and your credit cards and it will do
Debra Doak: Yep.
Alyssa Miller: that for you.
Debra Doak: It'll do it for you. I'm I'm a huge fan of you need a budget. I
Alyssa Miller: Mm.
Debra Doak: know it's not a free one, but it's if you want detail, that will give you detail of where every dollar went and then you can make decisions about that. So
Alyssa Miller: Yeah, I agree. That's one we recommend too.
Debra Doak: good. okay. You mentioned the marital home earlier, and it is often one of the most emotionally charged financial decisions, especially for somebody who doesn't understand all of it and everything involved with keeping the home, right? So what are some of the factors that you help people think about when they're evaluating and making that decision of whether they should try to keep the home or not?
Alyssa Miller: Yeah, yeah. it comes in a couple of phases. The first phase typically is the the big item usually is the mortgage. And
Debra Doak: Mm-hmm.
Alyssa Miller: is it feasible for you to even be able to take it over? One of the things that people typically don't realize is there is a very small number of mortgages that you can just assume, meaning
Debra Doak: Mm-hmm.
Alyssa Miller: I am just gonna take that mortgage over. And without doing much other than signing some paperwork, I just now have the exact same payment, exact same everything. It's just in my name only. Typically
Debra Doak: Right.
Alyssa Miller: that's not how it works. Usually the mortgage has to be refinanced into one person's name. And then we have to go through the whole process of qualifying for that.
Debra Doak: Mm-hmm.
Alyssa Miller: and that can be really challenging if there's a discrepancy in income, how much is left on the balance. And we also have to look at the difference in interest rates. I mean, in today's economic environment, so many people had such favorable interest rates coming off of COVID. And that's not where they are today.
Debra Doak: Yeah, I've seen people go from two point five to seven and that really changes that payment.
Alyssa Miller: drastically and you know people are really hesitant to get rid of that you know low interest rate understandably but sometimes
Debra Doak: Mm-hmm. Sure.
Alyssa Miller: there's just not a choice. it is what it is. And if we can stay in the house, if there's kids involved to be able keep them there, obviously that has a huge amount of bearing from you know a personal situation. But
Debra Doak: Right.
Alyssa Miller: the mortgage is one small piece of it because even if we look at it and say, yes, we can get you qualified, whether that's through income and support Whether that's through a portfolio loan, using the assets you already have as collateral
Debra Doak: Mm-hmm.
Alyssa Miller: against the loan if you don't have the income. There are ways to do it a little bit more creatively, but
Debra Doak: Right.
Alyssa Miller: let's say we can we can get it done and we can get you approved and we're staying in the house. Then the next question comes down to maintenance, you know, taxes and insurance are then going
Debra Doak: Yep. Yep.
Alyssa Miller: to change, keeping an eye on what are the utilities, and are there any major repairs and things that need to be done to the house.
Debra Doak: Right.
Alyssa Miller: we hear a lot, you know, the carpet is an issue and really needs to be replaced in the kids' room or the deck is bad or the window is leaking or the whatever, right?
Debra Doak: Mm-hmm.
Alyssa Miller: all of that stuff now falls on that person who who retains the residence. So being sure
Debra Doak: Right.
Alyssa Miller: that there's emergency funds available to be able to cover some of those things and prioritizing, right?
Debra Doak: Right. Yeah. If the air conditioner breaks or the roof leaks, do you have the cash to cover that?
Alyssa Miller: Mm-hmm. Mm-hmm. Yep.
Debra Doak: are you gonna shovel the snow? Like things that your spouse took care of too is something I like to talk with them about. Are you gonna clean the gutters? Are you gonna clean the second story windows? Are you doing the snow? Are you cutting the grass, cleaning the pool? Those are all expenses that come along with the house as well, right?
Alyssa Miller: Absolutely. And a lot of times we see people want to add things to the house because, you know, for their comfort level, they want to add a security system. They want to add, you know, ring doorbells and things like that. Doable,
Debra Doak: Right.
Alyssa Miller: but there's a cost associated with that too.
Debra Doak: Absolutely. Absolutely.
Alyssa Miller: we've seen people, you know, have some financial output after the divorce of saying, you know, we finally got past this. I have this chunk of money that I received from, you know, my spouse's accounts, and I want to use it to put in a pool. I get it.
Debra Doak: Mm-hmm.
Alyssa Miller: Right, totally get it, but it's a big expense, you know, a six figure
Debra Doak: Yeah.
Alyssa Miller: expense that, you know, let's maybe take some time post haste to be sure that
Debra Doak: Mm-hmm.
Alyssa Miller: a good handle on your budget, to be able to be sure that we have a good handle on some foundational things before we take a huge chunk out and make a big investment like that. Maybe the community pool or the country club or something else works for a little while until we, you
Debra Doak: Mm-hmm.
Alyssa Miller: know, get some some found some foundational things sorted out.
Debra Doak: Right, right, yeah. And then and then the other big question. So it's you can you qualify? Does your cash flow on a monthly basis support everything that's gonna be needed for that house? And then there's also the big one too of like you've half the equity in that home in most cases belongs to the partner, this the soon to be ex-spouse. What am I gonna have to give up on the other end to make that happen, right?
Alyssa Miller: Yeah. Yeah. And in today's day and age, so many families, the majority of their wealth or a big portion of their wealth, a lot of times comes from equity in their home, especially with the appreciation of home values across the country the last several years. And trying to buy that out, you're absolutely right. You know, dependent on how long they've owned the home, how much they put down on it originally, everything else, a lot of times that's a really big number and people end
Debra Doak: Mm.
Alyssa Miller: up giving up something really important like retirement funds.
Debra Doak: Mm-hmm.
Alyssa Miller: or liquidity in cash or in, you know, investments that they can have easy access to for the sake of retaining the home, which is something that we definitely have
Debra Doak: Right.
Alyssa Miller: to analyze.
Debra Doak: Yeah. So it's it's like we always say it's a it's a holistic agreement. You can't just make a decision about I'm keeping the house without understanding everything else that that means. Giving up the investments, giving up the retirement, and then what's the impact of that on your long term plan, right? Let's talk about retirement accounts because in addition to the family home, they're usually the largest asset. 401k, that IRA, that's usually the the biggest thing. And let's just talk about some of the things that are really important that people need to understand when it comes to dividing pensions and retirement accounts.
Alyssa Miller: Mm-hmm. I'd say there's a couple of big ones. One of which is understanding what kind of accounts you have, right? Just from a foundational level. Some of those accounts are pre-tax, but some of them could be Roth contributions. And that distinction is a really big one because one asset is a hundred percent taxable when you need to get that money out. The other
Debra Doak: Mm-hmm.
Alyssa Miller: is a hundred percent tax free when you need to get the money out. So
Debra Doak: Right.
Alyssa Miller: they're not equitable, even though they may have the same dollar amount on paper. so that's one really important aspect to understand.
Debra Doak: Right. the hundred thousand dollar Roth IRA is basically cash. A hundred thousand dollar traditional IRA is worth seventy thousand, not a hundred thousand, right? Depending on your tax bracket. So they're
Alyssa Miller: Yeah. Yeah.
Debra Doak: not equitable and people don't understand that.
Alyssa Miller: Yeah. That's definitely a big one. another would be taking a look at understanding That there are some special rules in divorce when it comes to dividing
Debra Doak: Mm-hmm.
Alyssa Miller: accounts. There's also different costs associated with dividing different accounts, and there's different wait periods in terms of dividing different accounts. So, especially with a later-in-life divorce where people are in retirement or nearing retirement, and that liquidity is going to really important. One of the things that we look at is, you know, IRAs can be divided within a matter of days. You need a finalized divorce decree and a signed piece of paper from the institution where it's held, and they'll divide those accounts. Very quickly.
Debra Doak: Mm-hmm.
Alyssa Miller: However, 401ks, 403Bs, you know, employer type plans are very challenging to divide and they take there's costs associated with it. It's not a ton, but there is a an extra cost associated with that to have extra paperwork
Debra Doak: Mm-hmm.
Alyssa Miller: created, extra attorney fees there. And it can take upwards of six months to actually get that money moved into your name. And if there
Debra Doak: Mm-hmm.
Alyssa Miller: is a time crunch or we need the money for liquidity to be able to buy a house or you know, do all these things, sometimes that can be a big factor in just saying, I want the same amount of money, but out of this account, not that
Debra Doak: Right, right. And that's that's part of getting literate about what these different accounts are, what the tax implications are, what the transfer requirements are, so that you can ask for in your settlement offer the things that support your own needs. So we've got to get clear. And you know, one of the things I really appreciate about you is that yeah, you're a wealth manager, but you also took the time to go get certified as a divorce coach so that you're helping people look at that. holistically and understand these emotional things that kind of get in the way of decision making.
Alyssa Miller: Yeah, yeah, absolutely. I will say one closing thought on that topic. Pensions are a completely different ball of wax.
Debra Doak: Yeah. Okay.
Alyssa Miller: we have it a lot here in our local community, right, with all of the different educational institutions and with the military base being right up the street.
Debra Doak: Mm-hmm. Yeah.
Alyssa Miller: So from you know, military or federal employee retirement system, those plans can be very intricate and all the pension plans are very different. police
Debra Doak: Mm-hmm.
Alyssa Miller: and fire is very different from Teachers' pensions is different from military is different from federal employees. And there's a lot of nuance involved in those that the attorneys are not necessarily always as well versed in as financial
Debra Doak: Mm-hmm.
Alyssa Miller: professionals. And if there's a pension involved and we're looking at valuing it and saying, I would rather keep all of my 401k and you keep all of your pension, is that fair? Those decisions, I would definitely involve a financial person because there is way more. moving pieces with the pension division than just, you know, I have a million dollars in my four one K and we're gonna divide.
Debra Doak: Yeah, absolutely. Those those federal pensions are they're tricky. You really need somebody who knows their way around and knows what questions to ask and knows how to do the paperwork right because like you were
Alyssa Miller: Yeah. The military. Yeah. Yeah.
Debra Doak: saying, like a traditional 401k is something called a quadro. Most people are familiar with that qualified domestic relations order. Not for the federal government. Of course, they have their own special requirements of a different kind of paperwork. So you've got to be working with somebody that's familiar with that.
Alyssa Miller: And military roles are even more complicated with, you know, how many years were you married and years of service and what benefits do you still qualify for if you're the non-military
Debra Doak: Yes.
Alyssa Miller: spouse? And there's very stringent deadlines to be able to keep your medical insurance and everything else.
Debra Doak: Yes.
Alyssa Miller: That that one is is very tricky and and I would definitely get help on that.
Debra Doak: Yeah, yeah. I know we're kind of we're starting to wind down here, but I guess for for somebody who hasn't had a a big role in their family finances, our goal is to help them create some financial stability after divorce. So if they've never managed the finances before, what would you recommend that they do in the first 90 days after divorce?
Alyssa Miller: Yeah, great question. one of them I think is an easy one we've talked about is getting a handle on your cash flow. That is something we can absolutely control. It is something that we, you know, one really have to know. and there is definitely plenty of one-off expenses that come right after the divorce being finalized, right? Some you know, payoff of legal fees and and those things aside, right? Replacing furniture, replacing physical assets that were divided. Those things
Debra Doak: Right.
Alyssa Miller: Getting a good sense for what is my monthly spend. Am I getting ahead, breaking even, or coming up short? And
Debra Doak: Mm.
Alyssa Miller: in all of those scenarios, there's opportunities to learn from it. The other thing that we really preach is ask for help, right? Whether that's finding a financial advisor or whether that's you know talking to friends and family that are more financially comfortable with these topics. you know, I joke all the time with my girlfriends. There's a group of twelve of us that get together every month and we play cards. which usually turns into not playing cards and just sitting around
Debra Doak: Right.
Alyssa Miller: and talking and having a glass of wine and and Yeah, yeah. Yeah, we call it card club, but you know
Debra Doak: I was that sounds like my book club, which was essentially wine club most nights 'cause we didn't read it. Yeah, yeah.
Alyssa Miller: we we joke that we there's pretty much no topic that's off limits, especially 'cause a lot of them
Debra Doak: Mm-hmm.
Alyssa Miller: are medical. So they've seen everybody's rash and everybody everybody's kids, you know, whatever, right? But
Debra Doak: Right.
Alyssa Miller: the one topic that people are very uncomfortable talking about still is money.
Debra Doak: Yeah.
Alyssa Miller: And finances. And I'm in that group and things come up and I offer, you know, do you guys want to talk about it? And they're like, no, no, no, no, no. Right. People feel like it's still a taboo subject.
Debra Doak: Yeah.
Alyssa Miller: And so if you're uncomfortable talking about it, find somebody that you're comfortable talking to them about it. Right. Find somebody that can help. Because so much of the time, you know, if we can just get you pointed in the right direction, great. Right. There's a
Debra Doak: Mm-hmm. Right.
Alyssa Miller: lot of financial advisors that will do free consultations. And yeah, the good ones will give you a fair amount of information to at least set you on the right path. And then if you want their help going forward, great. And if not, you know, get some things settled and then maybe come back when you're ready. but there are lots
Debra Doak: Mm-hmm. But
Alyssa Miller: of great resources online. There's lots of great, you know, podcasts and books and all sorts of things to listen to to help
Debra Doak: Right.
Alyssa Miller: educate yourself and make you more comfortable. And, you know, find a find some good podcast, find a good audio
Debra Doak: Yeah. Hmm. Right.
Alyssa Miller: book and listen to it on a walk or during your workout and just that
Debra Doak: We have to put that embarrassment and that shame aside
Alyssa Miller: Yeah.
Debra Doak: and just say, I didn't know what I didn't know. And then is it my Angelo? Now that I know better, I'm gonna do better. Right? but but we've got to put that embarrassment aside and really talk about it. You're right. Yeah, yeah. before we go, if you could give someone who's just getting started in the divorce process one thing you wanted them to take away from our conversation today. What would you want them to leave with?
Alyssa Miller: Don't be afraid to ask for help. there is way too many moving pieces in it, it is way too big of a lifetime decision to feel like you have to make these decisions on your own. You know, whether it's a a paid professional or whether it's, you know, friends and family who've been through it before, somebody
Debra Doak: Yeah.
Alyssa Miller: do not just go through it with your eyes closed, ask for help, do some research, educate yourself. Knowledge is power and being able to take back some control is a great way to be able to gain confidence and take control over a situation that feels uncontrollable.
Debra Doak: Yeah, exactly. And and I'm gonna add an an underlying when we say get support, most attorneys are not well versed in finances. So that is not the person we want you to rely on to say, sure, you can afford the house or no, you can't afford the house. Get somebody who's a really knowledgeable about finances to do that.
Alyssa Miller: Yeah, yeah. As someone who teaches continuing education for attorneys, I can vouch for that. you know, I've testified for many of them in court,
Debra Doak: Mm-hmm. I yes. Yep.
Alyssa Miller: and they are still learning things just as we are.
Debra Doak: Yeah.
Alyssa Miller: so I don't know everything about the law, that's not my job. They don't know everything
Debra Doak: Mm-mm.
Alyssa Miller: about the money, that's not their job.
Debra Doak: Right. Exactly. Good. All right. Well, you know, you and I could talk forever. And actually Alyssa works at the firm that was, they were my CDFAs when I was going through divorce. So we've we've been not only colleagues, but Alyssa knows all about my money. So she knows everything there's to know about that. And I thank you so much for joining us today and just talking about why financial literacy is so important. So thank you for taking the time out.
Alyssa Miller: No problem. I was so happy to be here.
Debra Doak: Good, good. And for anybody that's listening today, if you're going through divorce or if you're a professional who works with individuals going through divorce, I really hope our conversation today reinforces a really important message. And that is your client doesn't have to become a financial expert overnight. And it's not expected of them. But they do need to understand enough about their financial picture to make informed decisions. We don't want them at a cocktail party 10 years from now. Talking about how they got screwed because they didn't make informed decisions. It's their future and we want them to take their power back. So, all right. And think about their life tomorrow, not just what they're dividing today. So thanks for listening. If you found it helpful today, please share it with somebody who's navigating divorce or with a professional who's supporting clients going through divorce. And we hope you'll join us next week for another topic to help families navigate divorce more intentionally. with less fear and hopefully less conflict. So Alyssa, thanks again.
Tracy Callahan: Thank you for listening to the Divorce Coaches Academy podcast. For more insights and training, visit divorcecoachesacademy.com.
Debra Doak: Welcome to the DCA podcast. Today we're going to tackle a topic that can feel really overwhelming during divorce, and that's money. We all know financial decisions made during divorce can have consequences for decades. Yet so many people enter the process without fully understanding their assets, their living expenses, how retirement accounts work, what the tax implications are. What their life's really gonna look like. So we're gonna talk about the importance of financial literacy, talk about how to evaluate settlement options, we're gonna talk about the common mistakes people make, and what somebody can do to improve their financial confidence during divorce. So today I am joined by a special guest, Alyssa Miller. She has a ton of letters after her name. We'll talk about that a little bit. She's a private wealth advisor with Feldmauter Financial Group. And co-founder and managing director of Alternative Divorce Solutions, which is a Dayton-based practice she built with her dad to help divorcing clients gain financial clarity, whether they're mediating, doing collaborative divorce, or they're litigating. So, Alyssa, I'm glad you're here. I'm gonna go through some of your titles real quick so people can understand you know what you're talking about. Alyssa is a certified financial planner. She's a certain Personal financial analyst. she's a certified divorce coach. She's a certified long-term care professional, a certified divorce financial analyst, blosh, all the things. She's even served as a national board member for the Institute of Divorce Financial Analysts, which is where I got trained, is that's where the CDFAs get trained, right? And she's spoken nationally, presented to the Bar Association, et cetera, and focuses most of her work on helping clients understand. where they stand financially, how they can evaluate those settlement options, and most importantly create a realistic plan for their life after divorce. Whew, Alyssa, welcome to the podcast. Did I catch everything?
Alyssa Miller: Yeah, you nailed it. Thank you for having me.
Debra Doak: Yeah, we're so happy you're here. let's start off with this. Why is financial literacy such a critical part of navigating divorce? And then let's talk about some of the common mistakes you see people make.
Alyssa Miller: Yeah, well we could definitely we we could talk all day about that. And I I definitely do we have plenty of discussions about this topic for the community because unfortunately, so much of the time we see things on the other end after it's too late, after something's already been agreed to. And,
Debra Doak: Right.
Alyssa Miller: you know, at that point it is what it is, and we move forward and we make it work, but there's so many times where we look at something and say, if we would have just done this slightly differently, or if Different decisions had been made, or if they had had information at the time, we may have been in a better position to, you know, negotiate or to understand the long-term ramifications of a settlement offer.
Debra Doak: Yeah.
Alyssa Miller: and financial literacy from that standpoint, I mean, I just feel is so important because still in so many families that we serve, it tends to still be one person has a little bit more knowledge or a little bit more dominance in handling this subject than the other.
Debra Doak: Yeah.
Alyssa Miller: So much of the time we see maybe one party is helpful in paying the bills and managing the day to day, maybe keeping an eye on the budget, you know, kind of cash flow in and out, but that same person doesn't always have the same insight into the investments and, you know, some of the broader picture on things. those roles, you know, sometimes are are shared, but a lot of times are still siloed for couples. And so when you're put into a position, you know, having to evaluate these things and not having been that person. it can be very
Debra Doak: Right.
Alyssa Miller: overwhelming and cause a lot of angst.
Debra Doak: Yeah, I agree. I agree. What financial information would you say most people don't understand when they're coming into this divorce process?
Alyssa Miller: Yeah. depending on their comfort level with finance and understanding the investments that they have, a lot of times it's just some basics in terms of understanding what the different assets that they are, how they're taxed, how their long term consequences of being able to pull money out of them and when from when we look at things from a liquidity standpoint, and you know, what is the value of one asset over another. A lot of times there's an emotional tie to an asset, right? Specifically real estate, a lot of times.
Debra Doak: Yes. Yeah. And we're gonna talk about that for sure. Yep.
Alyssa Miller: Yeah, and that can tend to be, you know, challenging because we have memories associated with a place or a thing that people sometimes gravitate more towards as opposed to, you know, money in an account, whereas, you know, depending on the scenario, may make a drastic difference for long term.
Debra Doak: Yeah, I agree. I agree. let's talk about you've got somebody who doesn't understand the finances. Maybe their spouse took care of all of it. They just kind of ran the household expenses through a joint credit card and they didn't worry about it much. And now here they are and they're embarrassed. I hear that a lot. Like, I'm so embarrassed. I didn't have a better handle on this. How do you approach those clients or how do you work with them?
Alyssa Miller: Yeah. I hear that a lot too in the work that we do. And you know, what I always tell clients or people that come in to have discussions with us is there's nothing to be embarrassed about. You know, we all have different roles. we all have different strengths, right? In my home, I don't do any of the cooking. I'm an awful cook. When we are when my husband's out of town, we do take out because
Debra Doak: Okay.
Alyssa Miller: that's not my role. you know, and that's okay, right? We all have our our strengths and we have areas where we excel. And it is what it is, but at this
Debra Doak: Mm-hmm.
Alyssa Miller: point, it's really important to take a little bit of a step back and to say, let's get educated on some of these pain points to be sure
Debra Doak: Yeah.
Alyssa Miller: that we maybe we can't get you fully to equal footing, but we can surround you with experts or people who have the knowledge to be able to help and fill in those gaps where people are uncomfortable. And ultimately
Debra Doak: Yeah.
Alyssa Miller: we typically find that. A little bit of information goes a long way in terms of, you
Debra Doak: Mm.
Alyssa Miller: know, increasing confidence in the set.
Debra Doak: Right. Yeah. I mean I like to use the word yet. You don't understand it yet. You don't feel like you have a grasp on it yet, but it's figure outable, right?
Alyssa Miller: Yeah, exactly.
Debra Doak: Yeah. I'm sure you see this too. I have a lot of people come in and the word that's on their mind is fair. I want
Alyssa Miller: Mm-hmm.
Debra Doak: to get what's fair. I want to get what I'm entitled to, which doesn't always incorporate thoughts about long-term financial stability. So how do you help clients shift from thinking about what's fair today to thinking about is that workable for tomorrow?
Alyssa Miller: Mm-hmm. Yep. agreed. We we get that a lot as well. And when I speak publicly about this topic, one of the big categories of things that we discuss with people is having to get past the concept that fair and equal are the same thing. Because they're not. you know, something that is equal, you know, fifty fifty, just draw a line down the page and split everything in half, may not necessarily be fair. Because income
Debra Doak: Mm-hmm.
Alyssa Miller: is different and our our credit may be different and our ability to be able to handle certain expenses may be different. you know, so that may be equal, but it might not necessarily be fair.
Debra Doak: Mm.
Alyssa Miller: so it is a very difficult concept. we also have you know have seen a lot of clients get really concerned about past financial decisions that were made. And feeling like that needs to be rectified during the divorce process in some way, shape, or form. for example, you know, my husband put a bunch of money into XYZ stock and it just tanked. And I feel like I should be able to get some of that money back. Unfortunately,
Debra Doak: Yeah.
Alyssa Miller: some of those things, there's nothing we can do about it, right? That money's gone.
Debra Doak: No.
Alyssa Miller: It was spent, it was invested improperly, whatever the case may be. Now, extreme situations, a lot
Debra Doak: Sure.
Alyssa Miller: of times there may be an avenue for An attorney to be able to get involved to be able to make an argument about that. But generally speaking, it is what it is at that point. And we have to have a lot of conversations with people to say we are where we are. How
Debra Doak: Yep.
Alyssa Miller: we got here usually doesn't matter unless there
Debra Doak: Mm-hmm.
Alyssa Miller: was you know fraud or you know something really drastic that got us there. and so now we just have to look at how do we take the information we have and move. How we make the best situation out of what we have today? And a lot of times that comes down to trying to set aside the stress of what's going on now and be able to
Debra Doak: Mm-hmm.
Alyssa Miller: look forward and say, what is it that you do want after this? And sometimes it's easier, we find, for people to figure out what they don't want. Right.
Debra Doak: Mm-hmm.
Alyssa Miller: So having those discussions to say what is the game plan? Right. If if it was a stay at home parent that we're speaking with, you know, what sort of education do we maybe need to be able to get you back up on your feet? What sort of jobs do you think you would be able to qualify for? What is that income gonna look like? Right.
Debra Doak: Mm-hmm.
Alyssa Miller: we have a lot of conversations with people about housing and you know, what is the game plan?
Debra Doak: Yeah.
Alyssa Miller: do we wanna keep the kids in the same school district? If so, you know, what are what options are available and what can we afford?
Debra Doak: Does it make sense to buy? Does it make sense to rent? Right. We're running all those scenarios
Alyssa Miller: Mm-hmm. Yeah.
Debra Doak: with them.
Alyssa Miller: Yeah. And so in sometimes that is difficult for people to do, especially in an emotional state where there's just a lot of chaos going on, which is completely understandable.
Debra Doak: Mm-hmm.
Alyssa Miller: But if we can get people to self regulate and to be able to say, let's look towards the positive in terms of what your next phase of life is going to look like, you know, what do we need to do to be sure that those goals can be achieved, whether it's short term or long term?
Debra Doak: Mm-hmm. Right, right. So we're talking today about financial literacy. And somebody comes in, they don't know. The first thing I think I do and you do is we talk about gathering documents, right? Because we need to know what's on the table to be divided. We need to know what we have so we can educate our clients about it. So can you just briefly run through? I know the list is long, but briefly run through what kind of documents Coach could work with their clients together or people that are going through divorce listening. What would you encourage them to go look for first? What are they going to pull together?
Alyssa Miller: The easiest things to try to get to first is anything that you personally have access to, right? So bank
Debra Doak: Mm-hmm.
Alyssa Miller: accounts, credit card transactions. And in this day and age, so much of that is available online, right? investment accounts usually are householded so that my login can see my accounts and my husband's accounts.
Debra Doak: Mm.
Alyssa Miller: so being able to get into some of those or organizations and institutions to be able to pull basic statements on.
Debra Doak: Yep.
Alyssa Miller: where are we today? So bank accounts,
Debra Doak: Right.
Alyssa Miller: credit cards, investment accounts, if you have access to your tax return or can get in touch with your CPA if you had one, to be
Debra Doak: Mm.
Alyssa Miller: able to get copies of that. There will definitely be documents, especially in a in in a situation where there's not as much collaboration, that you may not be able to get to.
Debra Doak: Mm. Right.
Alyssa Miller: And people get very flustered over that, I have found.
Debra Doak: Mm-hmm.
Alyssa Miller: of you know, I have no idea how much is in their 401k. I have no idea, you know, where it even is. And that's okay,
Debra Doak: Yeah.
Alyssa Miller: because at some point that information will come to light, whether that's voluntarily or not. yeah,
Debra Doak: Well. Mm-hmm.
Alyssa Miller: that's what the attorneys are there for, right? If we can't get it nicely, they'll subpoena it and they'll come up with the information.
Debra Doak: Right. Right. Yeah.
Alyssa Miller: Being able to collect as much information as people can is helpful. I also tell people to pay attention to their mail, although so much that comes now is comes digitally.
Debra Doak: Yeah.
Alyssa Miller: There are plenty of things that still come as a quarterly statement or a notice through the mail. So paying attention to the fact that do we get notices and information from Chase Bank? Do we get information from, you know, Wells Fargo or Yeah, yeah,
Debra Doak: Fidelity, whatever, yeah.
Alyssa Miller: absolutely. a lot of times tax returns tell a huge portion of that story.
Debra Doak: They do.
Alyssa Miller: So if people don't have access to it, we tell them at least get me your tax return because you had to sign it. you should be able to get access to it.
Debra Doak: Mm-hmm. Yep.
Alyssa Miller: and that tax return can tell me a lot of times exactly where everything is and we can help guide
Debra Doak: Mm-hmm.
Alyssa Miller: people to, you know, where those where we need to contact institutions.
Debra Doak: Right, right. And gathering all this information, I always say there we're we're accomplishing two things at once, right? One is the income and expense. What does it cost me to live? Because that is a big filter for decision making. And then there's what's on the table to be divided.
Alyssa Miller: Yes.
Debra Doak: What's the equity in the house? What's in the four one K, all that. But for people that don't have a lot of financial literacy, really eve they have no idea and it's good. practice to start helping them figure out what is it going to cost me on a monthly basis. Because I'll hear, I'm sure you hear this too, he told me I have to get a job. He told me I'm going to have to go back to work. And I'm like, do you right? That's your choice. We're going to look. And that might be a choice you make to say, yeah, I want to continue to get my hair done or I want to continue to go to this Pilates studio, in which case support isn't going to cover it or the assets you're going to get aren't going to cover it. And then that's going to be your choice, but we have to know that framework first, right?
Alyssa Miller: Yeah. Mm-hmm. Yeah. And we have found that budgeting is not a skill that a lot of people one enjoy doing. Right. It's
Debra Doak: Yes.
Alyssa Miller: it's it's not a super enjoyable activity. Right.
Debra Doak: Yeah.
Alyssa Miller: and it's not always the easiest thing either, especially in today's world where, you know, you a lot of things are digital and you know, we're not writing checks for things, we're not paying for a lot of things in cash. So it's not as in your face apparent in terms
Debra Doak: Mm-hmm.
Alyssa Miller: of what we spend.
Debra Doak: Right.
Alyssa Miller: and even sometimes what we make, right? So thankfully now with with that technology also comes some good to say there is so many really great budgeting apps that are out there
Debra Doak: Mm-hmm. Yep.
Alyssa Miller: to be able to say all you have to do is just connect your bank accounts into them and your credit cards and it will do
Debra Doak: Yep.
Alyssa Miller: that for you.
Debra Doak: It'll do it for you. I'm I'm a huge fan of you need a budget. I
Alyssa Miller: Mm.
Debra Doak: know it's not a free one, but it's if you want detail, that will give you detail of where every dollar went and then you can make decisions about that. So
Alyssa Miller: Yeah, I agree. That's one we recommend too.
Debra Doak: good. okay. You mentioned the marital home earlier, and it is often one of the most emotionally charged financial decisions, especially for somebody who doesn't understand all of it and everything involved with keeping the home, right? So what are some of the factors that you help people think about when they're evaluating and making that decision of whether they should try to keep the home or not?
Alyssa Miller: Yeah, yeah. it comes in a couple of phases. The first phase typically is the the big item usually is the mortgage. And
Debra Doak: Mm-hmm.
Alyssa Miller: is it feasible for you to even be able to take it over? One of the things that people typically don't realize is there is a very small number of mortgages that you can just assume, meaning
Debra Doak: Mm-hmm.
Alyssa Miller: I am just gonna take that mortgage over. And without doing much other than signing some paperwork, I just now have the exact same payment, exact same everything. It's just in my name only. Typically
Debra Doak: Right.
Alyssa Miller: that's not how it works. Usually the mortgage has to be refinanced into one person's name. And then we have to go through the whole process of qualifying for that.
Debra Doak: Mm-hmm.
Alyssa Miller: and that can be really challenging if there's a discrepancy in income, how much is left on the balance. And we also have to look at the difference in interest rates. I mean, in today's economic environment, so many people had such favorable interest rates coming off of COVID. And that's not where they are today.
Debra Doak: Yeah, I've seen people go from two point five to seven and that really changes that payment.
Alyssa Miller: drastically and you know people are really hesitant to get rid of that you know low interest rate understandably but sometimes
Debra Doak: Mm-hmm. Sure.
Alyssa Miller: there's just not a choice. it is what it is. And if we can stay in the house, if there's kids involved to be able keep them there, obviously that has a huge amount of bearing from you know a personal situation. But
Debra Doak: Right.
Alyssa Miller: the mortgage is one small piece of it because even if we look at it and say, yes, we can get you qualified, whether that's through income and support Whether that's through a portfolio loan, using the assets you already have as collateral
Debra Doak: Mm-hmm.
Alyssa Miller: against the loan if you don't have the income. There are ways to do it a little bit more creatively, but
Debra Doak: Right.
Alyssa Miller: let's say we can we can get it done and we can get you approved and we're staying in the house. Then the next question comes down to maintenance, you know, taxes and insurance are then going
Debra Doak: Yep. Yep.
Alyssa Miller: to change, keeping an eye on what are the utilities, and are there any major repairs and things that need to be done to the house.
Debra Doak: Right.
Alyssa Miller: we hear a lot, you know, the carpet is an issue and really needs to be replaced in the kids' room or the deck is bad or the window is leaking or the whatever, right?
Debra Doak: Mm-hmm.
Alyssa Miller: all of that stuff now falls on that person who who retains the residence. So being sure
Debra Doak: Right.
Alyssa Miller: that there's emergency funds available to be able to cover some of those things and prioritizing, right?
Debra Doak: Right. Yeah. If the air conditioner breaks or the roof leaks, do you have the cash to cover that?
Alyssa Miller: Mm-hmm. Mm-hmm. Yep.
Debra Doak: are you gonna shovel the snow? Like things that your spouse took care of too is something I like to talk with them about. Are you gonna clean the gutters? Are you gonna clean the second story windows? Are you doing the snow? Are you cutting the grass, cleaning the pool? Those are all expenses that come along with the house as well, right?
Alyssa Miller: Absolutely. And a lot of times we see people want to add things to the house because, you know, for their comfort level, they want to add a security system. They want to add, you know, ring doorbells and things like that. Doable,
Debra Doak: Right.
Alyssa Miller: but there's a cost associated with that too.
Debra Doak: Absolutely. Absolutely.
Alyssa Miller: we've seen people, you know, have some financial output after the divorce of saying, you know, we finally got past this. I have this chunk of money that I received from, you know, my spouse's accounts, and I want to use it to put in a pool. I get it.
Debra Doak: Mm-hmm.
Alyssa Miller: Right, totally get it, but it's a big expense, you know, a six figure
Debra Doak: Yeah.
Alyssa Miller: expense that, you know, let's maybe take some time post haste to be sure that
Debra Doak: Mm-hmm.
Alyssa Miller: a good handle on your budget, to be able to be sure that we have a good handle on some foundational things before we take a huge chunk out and make a big investment like that. Maybe the community pool or the country club or something else works for a little while until we, you
Debra Doak: Mm-hmm.
Alyssa Miller: know, get some some found some foundational things sorted out.
Debra Doak: Right, right, yeah. And then and then the other big question. So it's you can you qualify? Does your cash flow on a monthly basis support everything that's gonna be needed for that house? And then there's also the big one too of like you've half the equity in that home in most cases belongs to the partner, this the soon to be ex-spouse. What am I gonna have to give up on the other end to make that happen, right?
Alyssa Miller: Yeah. Yeah. And in today's day and age, so many families, the majority of their wealth or a big portion of their wealth, a lot of times comes from equity in their home, especially with the appreciation of home values across the country the last several years. And trying to buy that out, you're absolutely right. You know, dependent on how long they've owned the home, how much they put down on it originally, everything else, a lot of times that's a really big number and people end
Debra Doak: Mm.
Alyssa Miller: up giving up something really important like retirement funds.
Debra Doak: Mm-hmm.
Alyssa Miller: or liquidity in cash or in, you know, investments that they can have easy access to for the sake of retaining the home, which is something that we definitely have
Debra Doak: Right.
Alyssa Miller: to analyze.
Debra Doak: Yeah. So it's it's like we always say it's a it's a holistic agreement. You can't just make a decision about I'm keeping the house without understanding everything else that that means. Giving up the investments, giving up the retirement, and then what's the impact of that on your long term plan, right? Let's talk about retirement accounts because in addition to the family home, they're usually the largest asset. 401k, that IRA, that's usually the the biggest thing. And let's just talk about some of the things that are really important that people need to understand when it comes to dividing pensions and retirement accounts.
Alyssa Miller: Mm-hmm. I'd say there's a couple of big ones. One of which is understanding what kind of accounts you have, right? Just from a foundational level. Some of those accounts are pre-tax, but some of them could be Roth contributions. And that distinction is a really big one because one asset is a hundred percent taxable when you need to get that money out. The other
Debra Doak: Mm-hmm.
Alyssa Miller: is a hundred percent tax free when you need to get the money out. So
Debra Doak: Right.
Alyssa Miller: they're not equitable, even though they may have the same dollar amount on paper. so that's one really important aspect to understand.
Debra Doak: Right. the hundred thousand dollar Roth IRA is basically cash. A hundred thousand dollar traditional IRA is worth seventy thousand, not a hundred thousand, right? Depending on your tax bracket. So they're
Alyssa Miller: Yeah. Yeah.
Debra Doak: not equitable and people don't understand that.
Alyssa Miller: Yeah. That's definitely a big one. another would be taking a look at understanding That there are some special rules in divorce when it comes to dividing
Debra Doak: Mm-hmm.
Alyssa Miller: accounts. There's also different costs associated with dividing different accounts, and there's different wait periods in terms of dividing different accounts. So, especially with a later-in-life divorce where people are in retirement or nearing retirement, and that liquidity is going to really important. One of the things that we look at is, you know, IRAs can be divided within a matter of days. You need a finalized divorce decree and a signed piece of paper from the institution where it's held, and they'll divide those accounts. Very quickly.
Debra Doak: Mm-hmm.
Alyssa Miller: However, 401ks, 403Bs, you know, employer type plans are very challenging to divide and they take there's costs associated with it. It's not a ton, but there is a an extra cost associated with that to have extra paperwork
Debra Doak: Mm-hmm.
Alyssa Miller: created, extra attorney fees there. And it can take upwards of six months to actually get that money moved into your name. And if there
Debra Doak: Mm-hmm.
Alyssa Miller: is a time crunch or we need the money for liquidity to be able to buy a house or you know, do all these things, sometimes that can be a big factor in just saying, I want the same amount of money, but out of this account, not that
Debra Doak: Right, right. And that's that's part of getting literate about what these different accounts are, what the tax implications are, what the transfer requirements are, so that you can ask for in your settlement offer the things that support your own needs. So we've got to get clear. And you know, one of the things I really appreciate about you is that yeah, you're a wealth manager, but you also took the time to go get certified as a divorce coach so that you're helping people look at that. holistically and understand these emotional things that kind of get in the way of decision making.
Alyssa Miller: Yeah, yeah, absolutely. I will say one closing thought on that topic. Pensions are a completely different ball of wax.
Debra Doak: Yeah. Okay.
Alyssa Miller: we have it a lot here in our local community, right, with all of the different educational institutions and with the military base being right up the street.
Debra Doak: Mm-hmm. Yeah.
Alyssa Miller: So from you know, military or federal employee retirement system, those plans can be very intricate and all the pension plans are very different. police
Debra Doak: Mm-hmm.
Alyssa Miller: and fire is very different from Teachers' pensions is different from military is different from federal employees. And there's a lot of nuance involved in those that the attorneys are not necessarily always as well versed in as financial
Debra Doak: Mm-hmm.
Alyssa Miller: professionals. And if there's a pension involved and we're looking at valuing it and saying, I would rather keep all of my 401k and you keep all of your pension, is that fair? Those decisions, I would definitely involve a financial person because there is way more. moving pieces with the pension division than just, you know, I have a million dollars in my four one K and we're gonna divide.
Debra Doak: Yeah, absolutely. Those those federal pensions are they're tricky. You really need somebody who knows their way around and knows what questions to ask and knows how to do the paperwork right because like you were
Alyssa Miller: Yeah. The military. Yeah. Yeah.
Debra Doak: saying, like a traditional 401k is something called a quadro. Most people are familiar with that qualified domestic relations order. Not for the federal government. Of course, they have their own special requirements of a different kind of paperwork. So you've got to be working with somebody that's familiar with that.
Alyssa Miller: And military roles are even more complicated with, you know, how many years were you married and years of service and what benefits do you still qualify for if you're the non-military
Debra Doak: Yes.
Alyssa Miller: spouse? And there's very stringent deadlines to be able to keep your medical insurance and everything else.
Debra Doak: Yes.
Alyssa Miller: That that one is is very tricky and and I would definitely get help on that.
Debra Doak: Yeah, yeah. I know we're kind of we're starting to wind down here, but I guess for for somebody who hasn't had a a big role in their family finances, our goal is to help them create some financial stability after divorce. So if they've never managed the finances before, what would you recommend that they do in the first 90 days after divorce?
Alyssa Miller: Yeah, great question. one of them I think is an easy one we've talked about is getting a handle on your cash flow. That is something we can absolutely control. It is something that we, you know, one really have to know. and there is definitely plenty of one-off expenses that come right after the divorce being finalized, right? Some you know, payoff of legal fees and and those things aside, right? Replacing furniture, replacing physical assets that were divided. Those things
Debra Doak: Right.
Alyssa Miller: Getting a good sense for what is my monthly spend. Am I getting ahead, breaking even, or coming up short? And
Debra Doak: Mm.
Alyssa Miller: in all of those scenarios, there's opportunities to learn from it. The other thing that we really preach is ask for help, right? Whether that's finding a financial advisor or whether that's you know talking to friends and family that are more financially comfortable with these topics. you know, I joke all the time with my girlfriends. There's a group of twelve of us that get together every month and we play cards. which usually turns into not playing cards and just sitting around
Debra Doak: Right.
Alyssa Miller: and talking and having a glass of wine and and Yeah, yeah. Yeah, we call it card club, but you know
Debra Doak: I was that sounds like my book club, which was essentially wine club most nights 'cause we didn't read it. Yeah, yeah.
Alyssa Miller: we we joke that we there's pretty much no topic that's off limits, especially 'cause a lot of them
Debra Doak: Mm-hmm.
Alyssa Miller: are medical. So they've seen everybody's rash and everybody everybody's kids, you know, whatever, right? But
Debra Doak: Right.
Alyssa Miller: the one topic that people are very uncomfortable talking about still is money.
Debra Doak: Yeah.
Alyssa Miller: And finances. And I'm in that group and things come up and I offer, you know, do you guys want to talk about it? And they're like, no, no, no, no, no. Right. People feel like it's still a taboo subject.
Debra Doak: Yeah.
Alyssa Miller: And so if you're uncomfortable talking about it, find somebody that you're comfortable talking to them about it. Right. Find somebody that can help. Because so much of the time, you know, if we can just get you pointed in the right direction, great. Right. There's a
Debra Doak: Mm-hmm. Right.
Alyssa Miller: lot of financial advisors that will do free consultations. And yeah, the good ones will give you a fair amount of information to at least set you on the right path. And then if you want their help going forward, great. And if not, you know, get some things settled and then maybe come back when you're ready. but there are lots
Debra Doak: Mm-hmm. But
Alyssa Miller: of great resources online. There's lots of great, you know, podcasts and books and all sorts of things to listen to to help
Debra Doak: Right.
Alyssa Miller: educate yourself and make you more comfortable. And, you know, find a find some good podcast, find a good audio
Debra Doak: Yeah. Hmm. Right.
Alyssa Miller: book and listen to it on a walk or during your workout and just that
Debra Doak: We have to put that embarrassment and that shame aside
Alyssa Miller: Yeah.
Debra Doak: and just say, I didn't know what I didn't know. And then is it my Angelo? Now that I know better, I'm gonna do better. Right? but but we've got to put that embarrassment aside and really talk about it. You're right. Yeah, yeah. before we go, if you could give someone who's just getting started in the divorce process one thing you wanted them to take away from our conversation today. What would you want them to leave with?
Alyssa Miller: Don't be afraid to ask for help. there is way too many moving pieces in it, it is way too big of a lifetime decision to feel like you have to make these decisions on your own. You know, whether it's a a paid professional or whether it's, you know, friends and family who've been through it before, somebody
Debra Doak: Yeah.
Alyssa Miller: do not just go through it with your eyes closed, ask for help, do some research, educate yourself. Knowledge is power and being able to take back some control is a great way to be able to gain confidence and take control over a situation that feels uncontrollable.
Debra Doak: Yeah, exactly. And and I'm gonna add an an underlying when we say get support, most attorneys are not well versed in finances. So that is not the person we want you to rely on to say, sure, you can afford the house or no, you can't afford the house. Get somebody who's a really knowledgeable about finances to do that.
Alyssa Miller: Yeah, yeah. As someone who teaches continuing education for attorneys, I can vouch for that. you know, I've testified for many of them in court,
Debra Doak: Mm-hmm. I yes. Yep.
Alyssa Miller: and they are still learning things just as we are.
Debra Doak: Yeah.
Alyssa Miller: so I don't know everything about the law, that's not my job. They don't know everything
Debra Doak: Mm-mm.
Alyssa Miller: about the money, that's not their job.
Debra Doak: Right. Exactly. Good. All right. Well, you know, you and I could talk forever. And actually Alyssa works at the firm that was, they were my CDFAs when I was going through divorce. So we've we've been not only colleagues, but Alyssa knows all about my money. So she knows everything there's to know about that. And I thank you so much for joining us today and just talking about why financial literacy is so important. So thank you for taking the time out.
Alyssa Miller: No problem. I was so happy to be here.
Debra Doak: Good, good. And for anybody that's listening today, if you're going through divorce or if you're a professional who works with individuals going through divorce, I really hope our conversation today reinforces a really important message. And that is your client doesn't have to become a financial expert overnight. And it's not expected of them. But they do need to understand enough about their financial picture to make informed decisions. We don't want them at a cocktail party 10 years from now. Talking about how they got screwed because they didn't make informed decisions. It's their future and we want them to take their power back. So, all right. And think about their life tomorrow, not just what they're dividing today. So thanks for listening. If you found it helpful today, please share it with somebody who's navigating divorce or with a professional who's supporting clients going through divorce. And we hope you'll join us next week for another topic to help families navigate divorce more intentionally. with less fear and hopefully less conflict. So Alyssa, thanks again.
Tracy Callahan: Thank you for listening to the Divorce Coaches Academy podcast. For more insights and training, visit divorcecoachesacademy.com.
