Exploring Grey Divorce & Financial Implications with Andrew Hatherley, CDFA, and Jody Bruns

Speaker 1 (00:00):

You are listening to Divorce Literacy with the Divorce Lending Association, a divorce podcast where we dig deep into issues of divorce that center around the marital home, other real property and divorce mortgage planning, helping divorcing homeowners and their divorce team make more informed decisions regarding home equity solutions during and after divorce.

(00:26):

I'm your host, Jody Bruns, president and founder of the Divorce Lending Association and Certified Divorce Lending Professional Certification. Today we are talking about divorce for couples over the age of 50, most commonly referred to as the Great Divorce couples can divorce later in life for the same reasons younger couples split up. But when you're over 50, these reasons are framed by aging and the realization that you may have more years behind you than ahead of you. And while there may be differences in the emotional impact of divorce for couples who in their marriages later in life, the biggest difference is that there is less time to recover financially. So whether it's because divorce is more acceptable now than it was in the past, or because more couples are running into unresolvable issues during retirement, many factors contribute to the high divorce rate among couples over the age of 50.

(01:21):

And while divorce is never easy, it can be uniquely challenging for that age group. Regardless of the why serious financial considerations for divorcing seniors may impact housing, real property and other financial concerns. We have an amazing guest with us today, Andrew Hatherley. Andrew is a Certified Divorce Financial Analyst in Chartered retirement planning counselor. He is the founder of Wiser Divorce Solutions, L L C, and Transcend Retirement L l c and the host of the Gray Divorce Podcast. After going through his own divorce, Andrew decided to help others avoid the financial and emotional stress so common to the process. Andrew is trained in both divorce, mediation and collaborative divorce. In 2022, Andrew started the Great Divorce Podcast, which is focused on mid late life divorcees rebuilding the financial foundation for a meaningful life after divorce. In addition to over 25 years experience in investment management and financial planning, Andrew has studied with leaders in the field of humanistic and positive psychology is a strong advocate for the role creativity can play in growing personally After trauma. He has a Master of business administration from McGill University in Asada and Barcelona. Andrew, welcome to the Divorce Literacy Podcast.

Speaker 2 (02:46):

Thank you very much, Jodi. Thank you for that introduction. You're reminding me of a few things about my life there,

Speaker 1 (02:54):

<Laugh>. So Andrew, you and I have had the opportunity speak previously about the financial implications of divorce in those over the age of 50, again known as the great divorce. You and I are obviously numbers people and I sometimes literally geek out, if you will, over statistics and things like this. I actually read lately that the divorce rate for those over the age of 50 has doubled since the 1990s in particularly that for those 65 years of age and older, the divorce rate tripled between the years 1990 and 2015. Why do you think the over 50 year age group are divorcing at such a higher rate?

Speaker 2 (03:44):

It is quite a social phenomenon, Jodi, this this growth in the divorce rate for the, for the over 50 group, you know, actually it was like one in 10 in 1991 in one in 10 getting divorced in 1990 was over the age of 50, and now it's one in three. Yeah. And you, you made the very good point. If you look at gray divorce says over 50, it's really the over 60 fives right now who are getting divorced at a higher rate than even even the 50 to 65. There's a lot of reasons for it. I think we discussed age, age is a key factor. Our life expectancies are, are getting longer and longer. And so we're realizing, I don't know, but I'm ex I'm, I should say I'm a I belong in the category of great divorce because I was 52. So I I'm part of the whole thing. 

Speaker 1 (04:42):

I know I need to admit that I'm part of that group too. <Laugh>.

Speaker 2 (04:45):

Oh, well there, I, I didn't realize that. So I'm, I'm very interested in in why it happens and I think one of the key reasons related to life expectancy is that people realize, you know, I've got another 20 or 30 years on this earth and I really want to be happy and I want to be with somebody that I want to be with. And I think that is a that's a key trigger to to getting the process going. There's a lot of other things too. I mean, divorce in our culture is a lot more accepted now than it was, you know, even 30, 40, 50 years ago. I think it was in 1973, that divorce surpassed death of a spouse as the primary cause for the ending of a marriage. Yeah. also the increased economic power of women as mm-hmm. <Affirmative> women are more independent.

(05:37):

They're more willing to, you know, cut the cord, so to speak, or go off on their own or establish their, you know, independent lives. You've got issues of children leaving the the home, the empty nest syndrome. And that can have an interesting implication on, on a relationship. You have a lot more no fault divorce laws than you did 30, 40 years ago. Yep, that's true. And I would mention also, you know, the personal development movement, this ties in a little bit with the idea of independence and, you know, living our best lives is, you know, you've got people like Anthony Robbins and Brene Brown and Simon Sinek, you know, you know, finding your why. Yeah. and that's encouraging people to, to, you know, be the, be the best that they can be. And quite often that involves resetting their life and, and getting divorced.

Speaker 1 (06:33):

That's an interesting take on that. You know, I know you and I have been both divorced and a failed marriage. You know, it can be hard, it can be as hard on your wallet as it is on your heart. Right, right. And, you know, the financial consequences of divorce, they themselves can be devastating for particularly those in the grade divorce category. You know, you have rising living expenses later in life can actually derail retirement plans or even make it impossible for spouses to keep the marital home on a single income. You know, according to U S A today, retiring can be 30 to 50% more expensive for divorce. Seniors, seniors who divorce are also gonna have obviously less time to pay off new debt and recoup those potential losses. You know, so if you think about it, even the earning potential for those in that divorce category of 50, 55, 65 and up, it can be far less if they've already left the job market to retire. Yes. You know, so being a certified divorce financial analyst, a divorce financial planner, what do you wish everybody understood about your role as a C D F A working with somebody in midlife divorces?

Speaker 2 (08:02):

I think for me, particularly because I am A C D F A, I have, I have two businesses. I have wiser Divorce Solutions, which is essentially working with people before enduring divorce. And then I have Transcend Retirement, which is my financial planning for my financial advisory firm, which is more concerned with financial advice, advising and, and investing. And that's more oriented towards helping people after the divorce. But all those facts that you, you just mentioned are very important. You know, when you're getting divorced later in life, you have far less time to recover. And, you know, the facts you mentioned about reentering the workforce you know, some of these things are particularly important to women is women tend to pay a higher economic penalty than men in divorce. And that's not saying that men don't struggle as well know when you're getting divorced and you're net worth being cut in half.

(08:58):

It's difficult on everybody, but it tends to be more difficult on women because men tend to, for, you know, this is way society is, have higher earning potential going into the future due to their work experience and stronger educational backgrounds. You know, quite often the, the, the woman was at home looking after the family and so would need to be retrained and reenter the workforce. And once again, a workforce that may not pay her as much as as much as man. I think the statistic is cuz we like our statistics, <laugh> <laugh> I think women's, a woman's standard of living after grade divorce tends to drop by about 40 to 45%. For a man, it's more like 20 to 25%. And so before the process, you know, when I'm working with people before the divorce, education is so important and so people need to get educated about the process.

(10:03):

I'm not an attorney. I educate people on the financial issues of divorce and, you know, we'll refer them to a suitable attorney as needed. But I hold regular workshops called the Wiser Divorce Workshop in here in the state of Nevada about the, the key issues of, of divorce because it's so important, particularly for great divorcees because of this time period in their lives that they try to get, I don't wanna say get the most they can, but un not give anything away necessarily in the divorce. So they can come up with the most workable situation that they can going forward. And divorce is, it's usually the largest, the largest financial transaction that's taking place in a person's life. And it's taking place under the worst circumstances. Yeah. The stress, the emotions you know, friends and family talking in your ear more often than not giving you bad advice <laugh> scripture.

(11:05):

And so, you know, learning from my experiences going through going through great voice, I thought, you know, I know what it was like for me and if I could, and as a financial advisor, help people not only learn, learn from the lessons, the hard-earned lessons that I dealt with but also, you know, others, they can better put themselves on a, on a financial foundation going forward. You know, there's, I don't know if you're familiar with the term or whether you experienced it during your divorce. I know I certainly did. They call it divorce fog or divorce brain. We really don't, we're not thinking very clearly. The emotions are completely out of, out of balance in terms of logic and, but we need that logic for the financial planning going forward. You know, there's a, there's a saying in the, in the legal world that the criminal justice system sees bad people on their best behavior.

(12:06):

You know, guys who with tattoos on their face of knives going into court with a, in a suit and tie saying, yes, your honor. No, your honor. Well, the divorce world sees good people on their worst behavior. This is true. I'm particularly proud of, never thought about that. Yeah. I mean, I'm not particularly proud of myself as a human being during my divorce and I'm sh I'm sure, I'm not sure, but I imagine my ex-wife is, isn't either. So, you know, before, that's, that's a key component of, of my role as a divorce financial planner before in the education cuz education is so important. And we'll get into that in a bit of little bit as well when we discuss the role of the C D L P. But during the divorce process, you know, I'll work with attorney mediators either as a financial neutral for a couple that are divorcing relatively amicably or as an advocate as part of the divorce team with the with the attorney and divorce lending professional therapist, c p a business evaluator to advocate for, for that particular client.

(13:14):

That's when I'm serving in an advocacy role with the attorney. And then after the divorce I help people who need financial advice going forward. I try and help them set the financial foundation for a meaningful life going forward. And even after divorce, there may be some divorce brain and people need to be reminded that, hey, you're getting half of your husband's i r a, it's over at Morgan Stanley. We need to open up an I RRA for you and get it invested, not according to his perhaps overly aggressive no.com or my do com I'm aging myself, no, whatever investment philosophy, but get it, get it invested according to your particular unique situation and all the other things that need to be changed with regards to beneficiary designations and all the other detailed tasks that need to be, you know, taken, taken care of to get to get set up on, as I say, on a financial foundation going forward.

(14:15):

So my role as a, as a divorce financial planner some CDs don't do the before enduring I do because I just felt that was part of what I had to do. So I, I do the before enduring and and the after. And sometimes it's different people. Sometimes I'll work on work with clients on the b before enduring and, and they'll go on their, their their way. And sometimes people will come to me after divorce and I'll say, yeah, I, I see what you gotta do, and I'll help them with the, with the financials. There's always a lot of variety.

Speaker 1 (14:48):

Yeah. So I always, you know, love hearing when I interview, you know, other professionals in the divorce world, what your interpretation is of your role, what you want others to understand about your role as a divorce financial planner. So I always like following up with this next question, which is, what's one commonly held belief about your role as a divorce financial planner that you passionately disagree with? And I think you and I have the same answer for this regarding both of our roles.

Speaker 2 (15:26):

I wonder, I wonder if we do love, I'd be interested to hear your answer after, after mine the most commonly held belief about my role that I passionately disagree with. I think I'd have to say that I think sometimes people think that I'm prodi divorce

Speaker 1 (15:48):

Ding dinging

Speaker 2 (15:49):

<Laugh>. Same with you.

Speaker 1 (15:50):

Yes.

Speaker 2 (15:52):

Yep. Yeah, yeah. No, no, it's, I'm, I'm neither prodi divorce nor anti divorce. What I'm advocating for is a world in which people have happy, healthy relationships, and so many studies have been done show that ultimately what brings happiness to humans is less the size of our bank accounts than the quality of our social relationships. Yeah, sorry. I mean, don't get me wrong. I'm a, I'm a financial advisor, so it's important to have a financial foundation in place and, you know, because that's, that's really my mission is to help divorcing people establish the financial foundation so they can live the next stage of their life in, in a way that brings meaning and and purpose to them. But you know, I studies, I, I saw one study that said, you know, there's diminishing returns after I think 75 or a hundred thousand dollars, you know, you need a certain amount of money to, for shelter and all the basic necessities of life, but once you get to a certain level, every additional dollar doesn't make you, honestly, doesn't make you a lot more happier than a millionaire.

Speaker 1 (17:00):

That's true. So I, I totally understand your answer and your response to that myself. You know, as a divorce mortgage planner, C D L P, we get the same pushback. Mm-Hmm. <affirmative>, you know, people think that we are an advocate for divorce. Heck no. Been there, done that, wouldn't wish that on anyone. Right. But the reality is, and you'll agree with this, every single divorce has some type of financial settlement. It could be as simple as closing a checking account and opening two new ones, but it goes even further, obviously when there's real property, other assets involved. Right. You know, and we have found, you know, at the Divorce Lending Association, just talking to other divorce professionals, that 65 to 70% of their divorce cases in the United States involve real property. Mm-Hmm. <affirmative>, you know, and it is such a highly, you know, valued asset. And there are so many things that can pose a hurdle, if you will, for either spouse to obtain mortgage financing, whether they're retaining the home or selling in each purchasing. But when you add in, you know, the topic that we're talking about, you know, the grade divorce and, you know, minimize potential income coming in, how do we then help, you know, those, those clients you knew mo move forward. So I am not an advocate for divorce.

Speaker 2 (18:36):

Right.

Speaker 1 (18:37):

You know, and, and I know you're not either, so that's why I kind of chuckled knowing <laugh> kinda where our response was going there. But it is, you know, it's sad that we even have to take the stance to, I know, defend our positions, but all we're trying to do is bring, you know, resolutions so that once the divorce is final, each spouse can move on with their life whole, or at least on the road to recovery, like I like to say.

Speaker 2 (19:04):

Right. And it's all a part, it's all a point a part of the process of educating people about the options. And you know, in, in your particular role as a divorce lending professional, the sooner that you're involved the better mm-hmm. <Affirmative> because there are key issues involved in divorce that you know, require your, your involvement. And unfortunately, many times it come, it comes too late. 

Speaker 1 (19:29):

Yeah, it does. You know, so obviously there's no way to sugarcoat, you know, the ramifications of divorce for anyone, let alone those over the age of 50. You know, for starters, your wealth drops by half sometimes, assuming you're gonna split everything equally at the same time, you know, your expenses are increasing. You've got now separate residences, two sets of bills for everything from utilities to insurance, et cetera. You know, and then in addition to that, obviously the home that you've planned to retire in might have to be sold. Right. And the proceeds split. Or, you know, if one spouse wants to retain the home, stay in the marital home divorcees again already in retirement, they may have difficulty buying the other party out, you know, or moving and purchasing, you know, so obviously you and I have had the conversation before about reverse mortgages For those listeners who are not really up on what a reverse mortgage really does, there's a lot of myths out there circulating around them.

(20:39):

But a reverse mortgage is a type of loan that allows eligible homeowners over the age of 62 to withdraw equity from their homes. You know, typically they have to own the home outright or have a significant amount of equity available. The borrowers have to occupy the property as their primary residents at all times. And the biggest myth is that you're gonna lose the home, you know, or you're gonna end up owing more and you are gonna be underwater. Right. But the mortgage only becomes due and payable with the reverse mortgage when the home is no longer the borrower's primary residence. So not getting into the specific details of a reverse mortgage, because that could be an entire podcast Right. Series on its own.

Speaker 2 (21:32):

Right.

Speaker 1 (21:33):

How do you incorporate, you know, divorce mortgage planning into your divorce practice, working with, you know, divorcing seniors, those over the age of, you know, 62 and particularly in, what are your thoughts on using a reverse mortgage in that situation to supplement income part of your estate planning process, et cetera?

Speaker 2 (21:58):

You know, with respect to incorporating divorce, mortgage planning, you know, I'm doing it more because, well, first of all, look, some external factors. We're looking at these increased values in homes and increased mortgage rates, ultimately making it more important than ever that we in the divorce process, that we can try to get some fi refinancing or for future purchases lined up. So it's more important than ever to incorporate divorce mortgage planning you know, into the, into the conversation. And I think it's important to bring a C D L P in into the process sooner rather than later, particularly one of the parties is looking to finance a home after the, after the dissolution of the marriage. I mean, C DLPs know the requirements of various lenders for establishing the flow of income in order to qualify for the mortgage and to have a C D P involved with the attorney and the financial advisor earlier in the process.

(23:03):

Unfortunately, I sometimes I'm brought in later in the process and it's, yeah, we just don't have the time. But which is, once again, you know, why I've started to bring Divorce lending professionals c DLPs into my divorce workshops. It used to just be myself as a divorce financial analyst, the, the family law attorney and a therapist. And then as long as these things have developed with respect to, you know, as my education has developed, and thanks to you very much for the work you do and getting the word out about the importance of this you know, I'm bringing C DLPs into the workshops to, you know, answer specific questions or, or, or chat later with, with attendees at the workshop about their about lending issues and, and giving them some, some hints as to how some problems might be avoided down the road. It's interesting you mentioned the reverse mortgage products. I've been in the financial services industry since the mid nineties. <Laugh>, and believe it or not, rev reverse mortgages were not always looked upon as the most as the best let's go. I can't think of the, the, the seven digit, the seven syllable word. The, we're always thought of as the, as the most

Speaker 1 (24:19):

Probably can't say it either.

Speaker 2 (24:20):

<Laugh> Yeah. <Laugh> as, as the most suitable financial product. But they've gathered quite a bit of respectability over the course of the past couple of years given the evolution of the products themselves and, and regulations and, you know, so they're no longer just the, the remedy of last resort that can be a, a proactive tool in divorce and particularly for helping you know, divorcing parties not get saddled with, with big big mortgage payments going forward. So I think always it's a, it's a situation by situation basis, but I have no, nowhere near the reservations about the product that I had in the past. And I have been educating myself more about it thanks to people such as yourself and the people you, you train through through the designation of certified deve divorce lending professional.

Speaker 1 (25:18):

Yeah. The reverse mortgages have come a long way. You know what, they used to scare people, you know, thinking that we're gonna lose our house if we end up owing more than it's worth. And, you know, they, the way that they have modified, you know, and grown and developed that product, they've put safeguards in there, you know, but not to, again, get into the reverse mortgage. A lot of people don't really realize that you can also use a forward reverse mortgage to purchase a home.

Speaker 2 (25:45):

Oh yeah. For great divorcees particularly.

Speaker 1 (25:48):

Yeah. You could have one party, keep the marital home, do a reverse mortgage, access the equity, do the other party. They could then take that equity and purchase a home and both spouses have a reverse mortgage and potentially not have an actual mortgage payment. So it is a good product, you know, use, again, in the right circumstance, et cetera.

Speaker 2 (26:12):

Typically the, the, the scene mid to late life divorces will have more equity mm-hmm. <Affirmative>. And so it works, it works better.

Speaker 1 (26:18):

Yeah, absolutely. So, kind of wrapping up here, if I could ask you one thing that I did not ask you, <laugh>, what would that be?

Speaker 2 (26:28):

One thing that you didn't ask

Speaker 1 (26:31):

Me, that's always a fun question on my behalf. <Laugh> put you on the spot.

Speaker 2 (26:35):

Let me put my thinking cap on. Well, I mean, one thing I always say at the divorce workshops, I don't think I've said it here today, is that there is life after divorce. And so I think maybe, maybe one, one thing we haven't discussed is the tool, I'm not a psychologist, but I've benefited from many of the tools of positive psychology and the role that mindset and attitude can play to rebuilding your life, both financially and emotionally and in relationships. It's so, so important after, after divorce. And so I always, like I said, I don't play a psychologist, but I always tell people, you know, it's always a good idea to take a step back and try and understand yourself a little better. Cuz I think sometimes we think we understand ourselves a little better than we actually do. And so there are personality assessments like the big five personality assessment.

(27:45):

I, I always I I think that's a helpful tool. There's a what's called the v i a Strengths finder. I think this goes really in tandem with some of the more popular books we've seen, like finding your why because the strengths finder will actually help you understand what you're really good at. And I think it's important to know yourself and what you're good at so that you don't get sidetracked and think that, you know, the Arabian basket weaving passion that you have is going to set you on a cour course for the rest of your life. You know, it's, I'm, I'm always get frustrated when people say, follow your passion, follow your bliss. Yes. But you need to, you need to kind of have a financial foundation in place, otherwise you're not gonna be gonna be at eat or, or, or, or have shelter.

(28:38):

I mean, these basics need to be met. And so there's another tool of positive psychology called Icky Guy, which is a Japanese word meaning life purpose. I don't know if you've heard of icky guy at all. Anyway, it's essentially, it's best demonstrated in a diagram where you have four converging circles and they're what you love, what you're good at, what the world needs, but also what you can be paid for. And so where those overlap often gives people a good hint about the direction they want to take their their lives going forward. So.

Speaker 1 (29:14):

Oh, interesting. Well, Andrew, I so appreciate you spending time with me and our listeners today and tell our listeners how they can get ahold of you if they would like to speak with you regarding their divorce, you know, situation. Also, I know you mentioned you were in Vegas, but I'm assuming you can help, you know, divorcees outside certainly Nevada as well.

Speaker 2 (29:39):

Certainly, certainly I can with people on the, on the financial aspects before, during, and after around the country. Certainly the before enduring I would, you know, bring in I, I would consult with experienced people in that particular vicinity. But the best way to get ahold of me would be through my two websites, transcend retirement.net and or wiser divorce solutions.com. And you can find me where all fine podcasts are played the Great Divorce Podcast. So if you look up the Great Divorce Podcast on your Apple or Spotify or also on my website transcend retirement.net, there's a podcast page. So that's probably the best place to find it.

Speaker 1 (30:29):

Very nice. Well, it has been a pleasure, Andrew, and I really hope that you will join us again in the near future.

Speaker 2 (30:36):

Thank you very much, Jody. I'd love to, I really enjoyed chatting with you and thank you for the opportunity to discuss this very important subject with your listeners.

Speaker 1 (30:44):

Thank you. Thanks for listening to Divorce Literacy. Discover more strategies and solutions on divorce mortgage planning@divorcelendingassociation.com.