That’s how one client described his divorce.
Like many people seeking a divorce, “Tim” just wanted a short and simple divorce without a lot of fighting over “things.” (No, it’s not really Tim. See Disclaimer.) Tim, a small business owner, has the “entrepreneurial temperament,” which means that he is used to getting what he wants, when he wants it. Divorce was no different, so Tim did a lot of pushing. After all, he was being “fair” and his wife just needed to see his side of things.
For “Kathy” (see Disclaimer), Tim’s wife of 17 years, divorce was not at all simple or easy. At first, Kathy was devastated and in denial. She was terrified of being on her own, grief-stricken that Tim would break up their family, and outraged that Tim had announced the divorce to her “out of the blue.” Kathy felt that she was at battle with an unseen force (maybe another woman?), so she gathered the “troops” — her girlfriends, family, teachers at the children’s school, hair stylist, and anyone else who would listen — to let them know how Tim had failed the family. Kathy got the validation she was seeking and many of those “troops” advised her to take Tim to the cleaners to teach him a lesson. Their advice was well-intentioned, but the worst possible thing they could have said.
So Kathy and Tim engaged the “best” lawyers they could afford. Tim’s attorney made settlement offers, demands, threats, and filed motions, pushing Kathy and her lawyer to accept Tim’s offers “within 24 hours or else.” Kathy dug in her heels and her attorney, happy to have “Cash Flow Kathy” for a client, was enlisted to help destroy Tim and the business. And it worked.
After two and a half years of litigating their divorce, including several motions to the Court, three marginally successul settlement meetings, and months of carping over every word in the final Decree, Tim and Kathy were finally divorced. Tim’s business, which had supported the family for years, was now on the verge of bankruptcy because Tim was too busy micro-managing his divorce to oversee the business. Tim and Kathy’s savings and their kids’ college funds were plundered to pay legal fees, with the remainder charged on a series of credit cards and Home Equity Line of Credit.
All told, Tim paid $65,000 in fees and Kathy paid over $80,000 in fees. They also paid $12,000 for a business valuation and $5,500 for a custody evaluation. The total value of their marital estate, including the value of Tim’s business, tax-deferred retirement funds, and home equity was just over $300,000. For Tim and Kathy, litigation cost them $162,500, or 54% of their total net worth. For their attorneys, it was just another divorce, a cash-flow product created out of thin air and client ignorance.
Was it worth it? Not according to Tim. The final terms of settlement that Tim and Kathy reached were almost identical to the initial settlement terms they discussed, before either one of them engaged attorneys. The two-plus years of bitter fighting took a huge toll on their three children, with serious long-term repercussions in their academic success and mental health. Tim and Kathy were both exhausted and devastated. They will likely never recover to their pre-divorce levels of emotional, physical, mental or financial health and their family relationship was badly damaged.
Tim andKathy engaged in a voluntary form of Financial Bedlam. Before you do the same, ask yourself one important question:
Am I willing to turn over a significant percentage of my net worth in order to be divorced?
If the answer is no, read my next blog about avoiding Financial Bedlam.
Choose Peace! (It’s cheaper.)