Ep 50: Key Finance Decisions During Major Life Events (Part 1)

Ep 50: Key Finance Decisions During Major Life Events (Part 1)

Are you ready to take control of your finances during life's most pivotal moments? In this episode, we dive into the complex world of financial decision-making during key life events. Whether you're experiencing the excitement of marriage or the joy of welcoming a new child or facing the challenges of divorce or the loss of a loved one, we'll provide practical tips and guidance to help you make informed decisions and maintain financial stability.


Get ready to unlock the secrets of managing finances during major life events, as we promise to open your eyes to the often overlooked financial aspects of such transitions. Join us on a journey that will empower you with the knowledge to constructively navigate financial landscapes in marriage, remarriage and retirement. We dive right into the crux of financial management in marriages, discussing the importance of merging finances, broaching the topic of prenups, and accommodating different money personalities for a harmonious life.

Transitioning into the complexities of remarriage, we delve into the unique challenges to consider, especially when blending families are involved. We guide you through updating beneficiaries, deciding on inheritances for current and previous spouses, and the paramount importance of maintaining financial transparency. The episode culminates with a focus on retirement, where we underline the importance of being in the know about your financial situation. Here, we discuss setting realistic retirement goals, crafting a budget, and staying updated on your investments. So, tune in and subscribe to Money, Chic, Women, and Retirement to keep abreast of all the latest financial insights.

Full Transcript

0:00:00 - Speaker 1

Discussions in this show should not be construed as specific recommendations or investment advice. Always consult with your investment professional before making important investment decisions. Securities offered through registered representatives of Cambridge Investment Research Inc. A broker-dealer member, FINRA, SIPC Advisory Services through Cambridge Investment Research Advisors Inc. A registered investment advisor Cambridge and Greenway Wealth Advisory are not affiliated.

0:00:20 - Speaker 2

It's time to dive into some insider secrets of investing and retirement planning To make your retirement as smart and as elegant as possible. This is Money Chic with Sherry Rash. Welcome to another edition of.

Money. Chic Women in Retirement. With Sherry Rash, we're going to talk about some key financial decisions to ponder during major life events. So we're going to go through we actually have eight of these we're going to go through and we're going to do this over the next two podcasts. So we'll get into this conversation with Sherry and kind of break down some of these things that might happen, things to consider when we go through major life events. Sherry, how are you doing? You doing all right?

0:00:58 - Speaker 3

I'm good. I'm not sure if you're aware, but this is episode number 50 for us.

0:01:03 - Speaker 2

Oh, it is 50. That's right, it is.

0:01:05 - Speaker 3

Yeah, so two years old Money Chic is pretty exciting, and it's so it's 50.

0:01:10 - Speaker 2

So it's starting to maybe think about retirement. The podcast is just starting to think about I should probably get serious about saving right.

0:01:20 - Speaker 3

That's right, that's that's what many of us do. I mean, I turn over the hill.

0:01:23 - Speaker 2

That's right. And when I turned 50, I'll be 52 this year when I turned 50, I was like maybe I ought to get serious on some of these things, which is funny, considering I've been talking about this stuff for like six years.

0:01:34 - Speaker 3

Right, right. Well, the shoemaker with with his children with no shoes, right as I was a buddy of mine was like he's a, he's a welder.

0:01:42 - Speaker 2

And he's like I need to fix some things around my house, I need to weld some stuff. And I'm like, what's your welder? And he's like, yeah, and I never weld at home. I was like, well, all right, and I guess that's true, let's people do that, but other than that, you doing all right.

0:01:54 - Speaker 3

Doing good, very good Good.

0:01:56 - Speaker 2

Good, let's get into these. I got, we kind of did these, we kind of line these up a little bit kind of like life events could happen now and hopefully this won't happen to everybody, specifically in the order that we're doing them, but we're going to, we thought, just for the kind of the sake of natural conversation flow. We kind of do these in this way. So let's dive in and get started with some things to ponder during major life events. We're going to first start with marriage. So, since you have clients, sherry, from really all ages, you know this is a good place to talk about. So what's some things to think about if you are, you know, getting married and thinking about finance, because finance is the number one argument amongst married couples.

0:02:35 - Speaker 3

It is, and I would say it's probably one of the items least talked about. Right when you're getting married, planning a wedding and planning your lives together. You're kind of thinking about all the fun things if you're buying a house or planning the actual event, but we rarely think about or talk about combining finances or how you're going to handle finances going forward especially. People are getting married a little bit older now, so they may have established careers and their their money habits already set with the way they handle things. So when you bring a new person in, it might change right or it might cause some friction. So there's a lot to think about when it comes to finances when you're married, and the good thing, though, is that there's not one right answer. You have to do what works best for you as a couple, yeah so, but are you going to have joint bank accounts? Are you going to keep your money separate?

I have some clients that have their own separate bank accounts and then one joint account, but then the question is well, if one spouse or partner makes significantly more than the other, do you still split the bills 50-50, because that doesn't necessarily seem fair. So that's a big one. Who's going to cover what. I had a call with a client the other day and they needed to tighten some things up as far as the spending goes. And her husband is very pro budgeting and cutting back and being restrictive and she isn't. She's like you know I've worked hard, you know I have my money and I do want to buy the $5 cup of coffee at Starbucks. So where, what do we do? And I said you know you both think differently about money, so understanding each other's money personalities and one isn't better than the other- it's just how to coexist.

0:04:27 - Speaker 2

Yeah, and that's a great point, because certainly that's going to be the case with many people. Right, we're going to have two different. You were often attracted, for whatever reason, to opposites in many directions, and the money seems to be one of those that you don't really realize until you really get into the nitty gritty of the relationship and you're like, oh okay, I'm a saver, you're a spender Great, this should be fun. You know that kind of thing. So good points for sure.

0:04:49 - Speaker 3

Yeah, and then you know this is always not a fun topic to talk about, especially with those newly engaged, but is a prenup necessary or desired. And it's not just for the rich, right, it can be for it really could be for anyone and it can help in the long run. If, unfortunately, the marriage does not work out, it could maybe help save a lot of fighting and and very sure.

0:05:15 - Speaker 2

Very sure, probably that way, okay. So yeah, we're going to, we're going to get into some more of these here. So the second point would be, if we're kind of going on order, sherry, we're going to go from marriage to maybe birth, right? So birth and or child adoption for many folks, what's some things to think about here?

0:05:30 - Speaker 3

Yeah, and this next topic is quite timely. You may have heard a little bit of a noise or whining in the background because the struggles of a working mother is that I have my three year old Joey with me right now while we're recording.

0:05:46 - Speaker 2

So Not flash today, today's, today's joy.

0:05:50 - Speaker 3

That's right. No flash today. It's just Joey. Thank goodness I was. It was almost an opportunity where I'd both of them and I said, no way, that can't happen.

0:05:57 - Speaker 2

That could be the rumpest room, right, it'd be a lot of fun, at least be on a podcast, but anyway, we're good. I'm glad he's in the background and how timely. So yeah, give us some things to think about working mom.

0:06:06 - Speaker 3

Yeah, so obviously lots of new expenses, right? So if both partners or spouses are going to continue working, you're going to have eventually the added cost of daycare or nannies, which in many places can be as much as your mortgage. So factoring that into a spending strategy is you know that's a big factor to consider life insurance. So likely you're going to need more life insurance now that you have a child and likely a mortgage and all of that, so updating life insurance plans and how much you have. And then obviously after a child's born, likely 18 years later, you're going to have another big expense of college.

So looking at different college savings plan options is also something to consider. As things settle down for you, Maybe some of the you get a handle on some of the added expenses of having a child, then you can start looking at college saving plans.

0:07:09 - Speaker 2

Yeah, for sure, you know, and so there's going to be impacts to your taxes, there's going to be all these different things and, of course, it's the general cost of life, right, certainly can get there and maybe, if you're talking about this category whether if you're a younger person, or maybe this is a grandchild, is born, right, so certainly some extra, extra expenses for grandparents, new grandparents, just maybe going to visit them, for example, in case they don't live nearby.

0:07:33 - Speaker 3

Yeah, if you don't live nearby and it's a plane ride away, you're going to have to now buy a plane ticket. You'll probably be visiting much more often if you're staying in the home or, you know, staying in a hotel nearby. So travel expenses you'll have. Maybe now you'll the baby will bring everyone together for a vacation, so you never know that the added expenses. And then many grandparents want to help with paying for college for their grandchild. So that's also something else to consider when you're also planning for retirement. Is that a gift you'll want to leave your grandchildren or give to your grandchildren is paying for their college?

0:08:15 - Speaker 2

And if you're working with a financial professional like yourself, whether you're younger in life and you're starting to you know, you're being smart and starting to work on those finances for the whole picture of life, or you're already you know retired or getting close to retirement, and this is a new wrinkle. You want to share that information with them so that you can adjust the plan right, so you can adjust accordingly to be able to fund those extra things that a child might bring to the situation. All right, so those are the first two. So we're going to do two more on this episode, as I mentioned now. Now we're going to have to turn and get a little dark because, again, the idea here is that it's major life events, so maybe those two things happen, and then, unfortunately, too often in our society, right Divorce comes into play.

It's certainly a very high among just about every age group and, as a matter of fact, even for people over 50, they call them great divorces they're happening at a higher rate sometimes than even for younger folks. So it's certainly something you got to talk about when looking at major life events. So what's some things in a divorce category to ponder?

0:09:19 - Speaker 3

Well, first it's just expensive to get a divorce right Going through. If you have attorney attorneys excuse me paying for that mediation, it's that's just expensive in itself. Right is to get it to get a divorce. But then you have to start dividing your assets and your liabilities, so splitting if. Are you going to sell the home or is one person going to stay in the home, then you have to do a then negotiating. Do you buy out? Who was ever leaving the home? Alamone if one spouse was staying at home, do they receive alamone and child support? So there's a lot to figure out. We just talked about saving for college.

Well, in a divorce, how are the two parents going to handle college expenses? Most things in my life come back to Real Housewives on Bravo, but one of my. I think I could do a podcast all about the Real Housewives and their financial drama. But one housewife got divorced and they had a real contentious battle, but the one thing that they didn't discuss was college. So the mother ended up having to pay for college for her three daughters, which she was not expecting at all. So figuring that out is very important and then also shifting your mindset to there used to be either two incomes going into the household, or there was one income, so now you're shifting from two to one and or even one to none, so going making that shift in income and potentially lifestyle.

0:10:59 - Speaker 2

Yeah, there's a lot of things and no matter what your age is, if you're going through a divorce, it's certainly problematic and difficult to deal with. But for folks who might be older right, if you know, if you get a divorce, you get married young and you get a divorce early on maybe you don't have as much to divide you talked about dividing assets and liabilities early on but certainly for folks that these great divorces people over 50, there's a lot more to unpack, right, there's retirement accounts and all kinds of things you've got to go through. So paperwork and just making sure you really do have a good team on your side and it's not just the divorce attorney, right, again, a financial professional could really come in handy here, helping you make sure that you're taking care of the things you need to take care of to set yourself up for, you know, the rest of life.

0:11:42 - Speaker 3

Yeah, I'm sure every advisor could have a story about that. They know of another advisor's client that never changed his beneficiaries from his first wife to a second wife and then the first wife comes knocking because she's the beneficiary, or changing insurance beneficiaries, powers of attorney. You have to make sure all of that is also taken care of timely, because if it's not top of mind you tend to forget about it.

And then someone you may not want to end up receiving your money is receiving it, so it's definitely important to have a team of people on your side to help you with it and walk you through the different phases, financially, of a divorce.

0:12:23 - Speaker 2

Yeah, absolutely Couldn't, couldn't, agree with that more. All right, so we've gone through, you know, we did marriage, we did the birth of a child or adoption, and then we unfortunately got a divorce. And now maybe, you know, life and light has shined on us again, jerry, and maybe it's an emotional roller coaster today on the show.

Maybe remarriage is now on the docket, right, because for many people you get a divorce and at some point hopefully you know find love again. And so these are some. There are some, certainly some things here to think about. For myself, jerry, like so my wife it's her second marriage to me, but just my first marriage and while she was still a little younger, there were still some things that we talked through you mentioned initially when we first brought up marriage. Just combining of finances is often a challenge enough. Well, certainly more challenging when you're walking into a second marriage, especially if you know maybe somebody's coming into that with, with kids from an existing relationship, right. So lots to think about.

0:13:19 - Speaker 3

I can't help but laugh when we are thinking about thinking about blended families. But then If any of the kids present specific financial challenges? If you remember the movie Stepbrothers- we will feral.

0:13:34 - Speaker 2

Oh yeah, of course, right, don't touch my drums, don't touch my drums.

0:13:39 - Speaker 3

So the two, the parties, get married, and they both have four-year-old sons that have yet to leave home.

0:13:45 - Speaker 2


0:13:46 - Speaker 3

And they're both embarrassed. They have their children completely relying on them still, but could, and luckily it works out for everyone in the end. But if one party has one child that hasn't flown the nest yet or that could be a source of friction or financial issues if you're supporting a child or a grown child that you may not necessarily desire to, so there can be definitely baggage when it comes to remarriage for sure you think about how progressive in a lot of ways, even though it was so wholesome in so many of the content, the Brady bunch, right, I mean all the way back to the late 60s I mean this is a huge thing.

0:14:29 - Speaker 2

You know this was a blended families, right All the way back there. So yeah, and there's so many little challenges that can go into to your point. You kind of touched on like updating beneficiaries and policies. Again, super point important to do when you go into a new marriage because you want to get the right people on there, because that is the Trump court. It doesn't matter what your will says, it matters what's on those BDs.

0:14:51 - Speaker 3

That's right. That's right. So the beneficiaries trump the will, and most people tend to update their will when something major happens and couldn't neglect their beneficiary designations. But that is what you need to make sure is updated. And then also think about you know what? About how much do you want to leave your current spouse, and then your children as well, from your previous marriage, if you want to leave them something in addition to, and then I would also say, make sure everyone's aware of the situation so that no one's surprised and or angry or disappointed in the end, which then could create a whole nother issue after you're deceased with fighting maybe fighting it out in court, not agreeing so being clear with what your intentions are while you're alive, but then also making sure that the paperwork backs it up.

0:15:44 - Speaker 2

Yeah and again. So remarriage, and it's important to definitely have those conversations about finance, whether it's the first marriage or second marriage. And you mentioned prenup on the initial marriage conversation, certainly something that comes up a lot more on remarriages, because maybe both parties and both parties are maybe a little more inclined to do that coming into a second marriage because they both have built an asset, especially if it's a remarriage later in life. So definitely something to ponder. Okay, so that was the first four, sherry, we wanted to go through. We've got eight of these, as we mentioned, on some major things to think through, key financial decisions to ponder during major life events.

When we do the next episode, we're gonna talk about maybe having aging parents living with us, disabilities, retirement, unfortunately, the loss of a loved one, so some other good key things that we're gonna go through as well. But that's gonna do it for this week on the show, as always, don't forget to subscribe to the podcast on Apple, google, spotify, whatever platform you like, using just type in Money, chic, women and Retirement into the search box of any of those apps and you can find us that way. Or just stop by Sherry's website, especially if you need some help and you'd like to have a conversation. You can find all the good tools, tips and resources at GreenwayWealthAdvisorycom. That's GreenwayWealthAdvisorycom to sit down and have a conversation and get started with Sherry Rash, financial advisor and money coach. Sherry, thanks for hanging out, and Joey as well.

0:17:08 - Speaker 3

Thank you. Yes, joey enjoyed it as well.

0:17:10 - Speaker 2

And he did a good job. So we'll be back with a couple or a new episode here in a couple of weeks. So make sure you subscribe to Money, Chic, Women and Retirement.

Shari helped my husband and I consolidate our finances and create a system that works for us. She is a great listener and very authentic - we are thrilled to have this trusted advisor on our team.

Jessica, Charleston
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