Gray divorce

Speaker 1 (00:08): Hi, and welcome to the first episode of your thriving practice, a podcast from Global Atlantic. I'm your host, Dan Corcoran.

Speaker 1 (00:17): If you are unfamiliar, Global Atlantic is a leading retirement and life insurance company that creates innovative products to help meet your client's financial goals. This is the first episode in our four part series on women and investing. And we are kicking things off with a really important topic to a number of people out there. Gray divorce women are one of the fastest growing wealth segments in the United States. But according to a 2020 report from management consulting firm, Oliver Wyman financial professionals are leaving about $700 billion a year on the table by not addressing women's unique financial challenges. And that is a lot of money. So we'll examine some of those challenges in this series. And look at ways financial professionals can evolve their practice to better retract and retain female clients. I'm joined by two experts in women's finance, Ann Hughes and Patti Hausherr. And as a leading authority on the topic of women in financial services and the founder of the female effect, which provides presentation and consulting services to financial professionals, looking to better serve women's financial needs. Patti is vice president at Global Atlantic consulting and a certified behavior finance advisor. She employs her knowledge and gained from over 25 years in the financial services industry as a speaker and consultant specializing in women in finance. So Ann and Patti, welcome to both of you.

Speaker 2 (01:42): Thank you. Thank you for having us.

Speaker 1 (01:44): So let's talk about this topic of gray divorce and that's when someone gets divorced when they are over 50. And I understand that the divorce rate for older couples is actually growing faster than the divorce rates for any other group. So Ann, we'll start with you. How does this impact financial professionals?

Speaker 2 (02:03): It's a significant issue and a significant opportunity actually for our industry. And as much as we don't wanna think about a topic like gray divorce, it's a reality. And as you referenced, it's the one category of divorce in this country. That's increasing. Every other category has gone down and that's pre COVID, but it's certainly been magnified by, I think what we've all gone through with COVID and spending more time at home with our partners. And we find that it's really simple math, but net worth drops by 50% because you're dividing your retirement assets to cover two lives or two lives in retirement versus one household and one joint life. And so we need the help of the financial services industry to be able to navigate this for most people. This is their first divorce and it's traumatic. It has a significant impact on women. Cuz we see that in a gray divorce situation, the standard of living for women goes down by 45% versus 21% for our male counterparts. That's an eye opening statistic

Speaker 1 (03:09): And Patti like angel said, this is a problem. And obviously these are important talks, but they're also really emotional talks. Can you talk about how you balance both the emotion and the duty you have

Speaker 3 (03:21): Emotionally? I'm thinking this is a time when we've sent our kids off to college, they're starting to build their lives on their own. So emotionally some of those responsibilities, I think that women had of raising children, you know, keeping their home, their career, some of that is going away and it, it is such a dramatic change. So for financial professionals, I think it's really important that we are able to connect with our clients on an emotional level and reassure women that are going through this, that they deserve to be happy and that you together are gonna make sure that they're financially stable and can live the life that they wanna live moving forward.

Speaker 1 (04:07): So I think we all know somebody that's going through the process of divorce right now, but women face a set of demands that maybe men don't in this day and age. Talk about that.

Speaker 3 (04:19): Yeah, that's a good observation. Dan, if I think about myself, having gone through divorce, uh, a little over 10 years ago, myself, the demands I put on myself were great prior to divorce, but the demands I put on myself as I was going through and after were even greater demands. As, you know, being a parent, I needed to be super mom. I needed to be great at my job and unbelievable performance because they're thinking she's going through divorce and you know, I need to be even better or just as a child to my aging parents, you know, I wanted to be super daughter too. So that was always there. Mm-hmm but then when you're going through a divorce, it's even more so right as you're going through a difficult time. When most of the time you cut yourself, some slack, you feel

Speaker 2 (05:07): As if you're under a microscope at this point in your life. And there is a lot of judgment that can swirl around. So being able to feel confident with your trusted financial professional and feel as if you're coming from a place with a solid foundation for your finances can give you the confidence in a lot of different areas as you are spread so thin as a caretaker, as a nurturer, to your point, Patti, I think that's spot on.

Speaker 1 (05:32): All right. There's been some talk about financial professionals, maybe going into autopilot mode. Can you talk about that Patti and why that could be a problem?

Speaker 3 (05:41): Every successful advisor, uh, Dan has a process for sure. I mean, they've got a way that they conduct business, a process they go through, which is good. I mean, it it's what makes advisors successful. It's just, sometimes we have to be careful about putting that process out there from the onset. You know, this is how I do business or, and, and take a step back and be willing to take it all in before moving through that process. Cuz it's really not about our process as the advisor, it's really about where the client needs and wants to go. But that being said, we have to have a process to be successful or we'd be all over the place. So I think it's just a, take a step back again, take it all in. Don't go for the solve. Don't go for the, the strategy or the solution right away seek to first understand

Speaker 2 (06:35): It reminds me of everyday life. You know, if you have a friend, a partner, spouse, whomever, it may be, and sometimes you just wanna talk something out. You don't want the solution. You just wanna say it. And I've nicknamed someone solutions guy because every time I wanna talk, there's a solution. And I think it can be very similar in a professional setting. So we have to separate out the process as Patti just said perfectly from the relationship. And so you have a proven process that likely you have a strategy, you know, where things are gonna go from a technical standpoint, but every relationship, every interaction is different. Every client comes with a unique set of circumstances. So treat it as it is. It's unique and take that time to listen, to let her get it all out without offering solutions instantaneously. And as just saying, I've got this, I understand this. This is what I do. Don't you worry? That can cause more worry, not less. So separating those two from the process to the relationship and not having every solution when she just wants to talk will garner a lot of respect from her and start to craft that trusting relationship that we're all striving for

Speaker 1 (07:51): And having a solutions guy also helps too,

Speaker 2 (07:53): Right? Yes. When asked , you know, I think of two different people that, that come to mind that I've worked with over the years and both went through a divorce, a gray divorce after they had turned 50 very different circumstances. One was the primary breadwinner of her household. And so when she decided to get a divorce, she was the one paying. It was really her assets that were being divided. The other that I worked very closely with had always been the homemaker or the stay at home mom. And so she was relying on her soon to be ex-husband's finances for the rest of her life, but not knowing exactly what they were because she wasn't necessarily engaged in the process. The first one I referenced that was the primary breadwinner had a very good understanding of her finances, but they came at it with the same issues, the same emotional ties and tugs of do I stay in the home?

Speaker 2 (08:51): Do I move out? How does this affect my family? Even if I have grown kids, because for women, we often make decisions based on those emotional feelings that we have, those sentimental feelings that we have. And so when it comes to things like a divorce, more often than not studies show that women wanna stay in the family home, there's that sentimental pull, they can't see themselves moving out or moving into an apartment. So that may be what she gets out of the settlement or through the divorce proceedings. Men typically are more likely to go with the liquid assets. So actually, you know, whether it's your stocks, your bonds, your retirement accounts, women often go after those more illiquid assets like the sentimental home, like not wanting to give up the car or, or something like that. And so what happens is it's so much more important to have that financial advice and perspective from a professional who says, okay, I wanna sit and listen to your emotional ties and the sentimental nature of what you're going through.

Speaker 2 (09:55): And then I wanna provide you perspective on what might be the best financial decisions to make so that you have a strong financial future going forward. And based on those two inputs, mind, and yours will craft a plan that's best for you both financially, but then also gives you peace of mind and addresses the sentimental things in your life that are difficult to give up or change. And so I think that's where we come from is that everybody is very different, but there's some common denominators and you as the financial professional, provide that voice of reason to balance out the emotions that she may be feeling.

Speaker 1 (10:30): So as you move through these conversations with these clients, these female clients, and there are so many emotions kind of involved in it, how do you get them from walking in the door and starting this conversation to actually having them feel like they're on steady or ground when they leave

Speaker 2 (10:48): A plan is so important. And what we have to remember is these are huge life events. So even the most decisive people, men or women will struggle when going through something like a gray divorce. And so being able, as I said before, to be that voice of reason and map out a plan, because we also have to remember, finances are one piece of all the decisions that need to be made when a divorce happens. They're often the most important piece, but there's also things with children. If they're still at home, elder parents and relatives, so many properties, so many things that need to be thought of. And so what works really well is developing a plan and it's overwhelming. So being able to what I call chunk that plan. So sit down with her and say, okay, here's a list of the decisions that need to be made.

Speaker 2 (11:39): So let's map those out into our near term decisions, our midterm decisions and our later decisions and chunk that out and say, okay, here's the list of things that are very pressing that in the next one to three months, we need to take action on, or we need to make a decision. Then here's the things three to six months out or longer, or a year later, that starts to make something that seems very unmanageable, manageable, and tangible. And what we find is once one or two or three decisions are made that are well thought out, it brings confidence. It brings confidence for her to tackle this, to make decisions in the future and gives her the boost that she needs to be able to get through something that could be the most difficult thing that she's ever gone through in her life.

Speaker 1 (12:27): And these are complex topics to even discuss. And, and Patti, maybe some of the women that you're speaking with and helping may not even know the term gray divorce or that they're involved in that because I don't know how widely that term is used, you know, in the public's sphere. But there are some people that might be listening to this right now that are part of that and realizing, this is me, you know? So how do you approach conversations with people that are just kind of realizing that they're in this particular situation?

Speaker 3 (12:57): Yeah, that's actually a really good point. Dan. I don't know if people know the term gray divorce and sometimes when you're going through something life changing and something difficult. It's very comforting to know that you're not the only one, right. That's headed in that direction. I think education is such a big part of it. Uh, I read a statistic the other day that 61% of divorced women say that they wish they had talked to an expert. So they're not looking to talk to friends or relatives. They're looking for an expert that they can talk to to get through it. And I think that education just is the first thing that comes to mind, you know, and we are faced with making decisions where we don't feel like we have the information we become paralyzed. We can't move forward. And as financial professionals, I think one of the best things we can do is to provide that education. So she's feeling good about the decisions that she's making and, you know, just sort of that empowerment and that knowledge really helps you move forward and move closer to that new new life. So I think education and educating her is what's going to create that momentum versus feeling paralyzed, which is where she typically is initially.

Speaker 1 (14:11): So when they come through your door and sit down with you, what do you tell them? What are some of the things to just get them, just that first few steps to let them know it's gonna be okay.

Speaker 3 (14:21): I think the very first part of the discussion is, you know, you have lived a great life. You've done so much, you're accomplished, you've raised your, whatever it is, and you deserve to be happy. You deserve to have a happy life and this next chapter, I wanna help support you to make it the best it can possibly be. So I think there's that emotional start. And, uh, and then I'll, I'll flip it to you. And I know you have thoughts about that,

Speaker 2 (14:49): Certainly. And, and I think spot on because sometimes we need permission and we find that more with women historically than our male counterparts is, am I doing the right thing? Am I being selfish? If she's the one that's initiated the divorce. And as Patti referenced now with great divorce, more women are initiating that than men. And so she often wants reassurance that I'm doing the right thing and that can come from a variety of people. It comes from friends, it comes from a financial professional, it comes from a counselor. And so I think that is so important. As Patti said, is creating that comfort around if this is where you, you see yourself being happy or the best step for you, I am very supportive of that and I will help you get there financially. Those words can be so important and not having judgment because often we do feel judged, whether we're the ones that initiated it, or we're on the receiving end of why didn't we make this work?

Speaker 2 (15:49): Why are we so, you know, late in life getting divorced. And, and I think, you know, the term gray divorce is it, you know, it does put an image in your mind, right? Mm-hmm , and we're talking about people over the age of 50, and I think there's a negative connotation to gray divorce. You're in your senior years, why even bother, you know, I digress, but I was buying a mattress and the salesman said, well, for our silver couples, I really recommend this mattress . And I thought, what, you know? And so I think now that I talk about great divorce, I think that has the same kind of negative connotation that, oh, you're old. So why bother? And, and we don't want that, right? We want to create an environment where this is a very difficult life situation, and we're there to help.

Speaker 3 (16:32): I think about Maslow's hierarchy of needs, right? I mean the more comfortable, or the more secure we are, we move up the pyramid, right? So prior to divorce, I think many people and women may have felt pretty secure in their financial situation, but after going through divorce or going through it, they've kind of fallen down that, you know, that cycle they've fallen down to now not feeling secure. So I think we need to recognize that as financial professionals, that that security could be very different after, or going through than it was prior.

Speaker 2 (17:15): Your life's been thrown in a blender and we don't know what it's gonna come out looking like. And that can be very unnerving and, and terrifying. And speaking from personal experience, having gone through a divorce, it, everything, the deck chairs have all been rearranged. And so how do we not take that as a financial professional and just say, okay, and dismiss it because we have urge, we'll help you get through this, let's pass through this, don't dwell on this. But a lot of times it needs to be dwelled upon it needs to be considered. And so giving that time and space and grace to let somebody have all the feels and go through those emotions that will impact those financial decisions. Then being that trusted partner, we talk so often in financial services, but that money is really the gateway to everything else that we want to do in our lives, whether it's help our children, whether it's donate to charity, start a business, whatever it may be.

Speaker 2 (18:13): And so it is very near and dear to our hearts. For that reason, women often come from a place as caregivers and nurturers. And what we find is that particularly if she initiated the divorce, we find at times she comes from a place of guilt and wants to be over generous saying, okay, I initiated this. I feel so badly. He can have this. He can have that. I'll just pay it and walk away. We need someone to, to set that right with us, or if we did initiate it, but we maybe feel that we had some role in it that we'll take less than what really is a fair division of property. And so it's, again, that voice of reason to take some of the emotion out of it to say, no, these are, are my recommendations based on all of my years of experience.

Speaker 2 (18:59): And, and don't just settle or don't just take whatever to get it over with. We have to make sure you're financially protected. We recommend asking those open-ended questions to get to know her, to tell me more about, you know, what are your greatest fears and concerns with regard to money going through this divorce? How would you rate your financial health? What are the topics that you would like to know most about how can I break this down and make this easier for you by asking those questions you get to what is most important to her? And you also create a client that is there out of loyalty and wants to stay with you and will often recommend you to others.

Speaker 3 (19:40): I think the second part of that is to make sure that we got it right to reaffirm that we hear what she's saying and what is top of mind. Um, so it's sort of validating or, or understanding what it is that she's telling us and, and making sure we do have it right, because you know me when I've gone through difficult times or sometimes your ideas, your thoughts are very scattered. And I think it's important to get to that point of understanding so that you're both on the same page and she recognizes that you are on the same page and that you do understand.

Speaker 1 (20:16): I think one thing that's important to point out here is that this process, if you're that client that's going through this, it can be a lonely place. Right. So how does a financial professional help with that when there's just so many questions to be answered sometimes at a really quick pace, how do you step in and kind of take stock of what's going on, Ann,

Speaker 2 (20:36): The advisors and professionals that do really well at this create a network, a referral network. So they'll partner with divorce attorneys or family law attorneys, CPAs counselors, and be that conduit to all of those other professionals if she needs it. And so I have worked with an advisor in, in Dallas that has done a great job, both in working with divorced women and widows. And what she does is she creates these workshops and she brings in somebody to talk about nutrition or stress management or a CPA or a family law attorney. And they do these half day seminars so that women can come in and address all of the things that are going on, not just her finances, they built such a strong network, and that is how they get referrals. They work together as a team and it does, it really elevates the level of advice that you give the level of trust, because you're seen as somebody that cares about every facet of what's going on, not just the financial piece. And that is a way to build your business, build that referral that put that stake in the ground, that you've built a profession on helping women going through divorce or whatever topic it may be and become that expert in that area.

Speaker 1 (21:51): And Patti, there are so many resources that financial professionals have at their disposal to help clients that are in this situation. Talk about that and how important it is to kind of build that trust with the clients so that they'll be open to accepting the help that you can offer.

Speaker 3 (22:07): Yeah. You know, it's interesting, Dan, when you mentioned it can be a lonely place. I think about many people and absolutely women who have gone through divorce and their friend groups can change. You know, maybe they've been when married's done a lot with couples and now suddenly they're hanging out with other single women or, you know, people who have gone through similar experiences. I think one thing that advisors, uh, can do. And in fact, I have an, a woman advisor in Palm beach, Florida, and she does a fabulous job of bringing like people together. She'll always have some type of educational portion to the meeting, but she'll bring folks together. So maybe you've got somebody who divorced 10 years ago and you've got someone who's just going through divorce. And she strategically seats people together almost so that she can create mentors within her own client group to help some of her clients move forward. So that is sort of a resource within her own book that I thought was just brilliant. I had the opportunity to attend, uh, one of those sessions with her

Speaker 1 (23:11): Feeling a sense of community when you kind of feel alone can be a wonderful thing. This has been a great way to kick off our series on your thriving practice, really great information perspective here. And both of you today have shared some aspect of your personal lives and how you bring that human side to your profession. I think that's really important in this discussion today because the people who be coming to talk to you wanna feel like they're dealing with a human being. So how important is it that they walk away from your conversation feeling like you do care about the outcome.

Speaker 2 (23:45): Don't be afraid to share personal things about yourself. You're coming from a place of human being to human being not just financial professional to client. So it has to be within your comfort level, but being real and being human and inviting those types of conversations, make these relationships that last for a very long time. And so I, I would say to, to every financial professional out there, that's listening, make sure if you're working with couples that, you know, both the male and female or both partners in the couple whomever, they may be equally because you have two clients, you don't have one. And if some event happens, you want to have strong relationships with both of them. So take the time to make sure your client base is being educated and engaged in the process before a big life event where it becomes fast forwarded and, and mandatory. So that's really my takeaway. This is a long process. Life is long and the better we can prepare our clients, male and female for a long life in retirement, that's well funded. The better off they will be. And certainly the better off you will

Speaker 1 (24:54): Be. And Patti, there are people in everybody's lives, their family, or at least in their professional network, they may be going through what we've been talking about today. This phenomenon of grade divorce, final thoughts from you today.

Speaker 3 (25:06): Yeah. You know, I think about this great profession that we chose to be in. I think most people have a desire to help other people. And I also think that when we think about or reflect on very difficult times in our lives, we pretty quickly can think of the people that were really there for us. And as you think about that, and you think about your own career as a financial professional, we really have an opportunity to help people get to the other side. And there is great purpose in that. And beyond purpose, there is just an opportunity to become a very meaningful person in that woman's life. And to be that is certainly going to withstand the volatility in the markets or different aspects that can break a relationship. It's a bond that pretty much can last forever. And so I think there's a huge opportunity for our industry to work with women in particular that are going through life events to include divorce. And I think just to put ourselves there and get in it with her is the best piece of advice I could offer

Speaker 1 (26:20): Patti. And thank you both for this conversation today. All right. So if you enjoyed this episode, don't forget to listen to our other episodes on women and investing, covering the topics of widowhood caregiving and small business owners. I'm Dan Corcoran. Thanks so much for being with us and we'll see you next time. Global Atlantics, your thriving practice podcasts are available on your favorite podcasting app or at global atlantic.com/professionals. The opinions, beliefs, and viewpoints expressed by the guests on this podcast do not necessarily reflect the opinions, beliefs, and viewpoints of Global Atlantic financial group.