Creating a Financial Plan When Starting From Ground Zero in a Divorce

Divorce can flip your financial life overnight, especially if you were not the person paying the bills, tracking accounts, or managing investments. We sit down with Ryan Finley, CPA and Certified Divorce Financial Analyst, to map out what a real “ground zero” financial reset looks like and how to replace panic with a clear plan you can actually follow.

We start with the basics that make everything else possible: gathering documents, building a marital balance sheet, and translating tax returns and pay stubs into a simple picture of income. Then we get practical about divorce budgeting by categorizing 12 to 24 months of bank and credit card activity so your monthly spending is based on facts, not memory. From there, we walk through the tough decisions that hit fast, like whether keeping the house helps your kids or quietly harms your future cash flow, and how child support or spousal support may fit into the math.

Ryan also explains why equal looking assets can be wildly unequal after taxes, especially when dividing retirement accounts and investments with different cost basis and capital gains exposure. We dig into advanced issues that often show up in negotiations, including vesting bonus plans, forensic accounting, and tracing dissipation. The through line stays the same: build a plan that helps you feel steady now and capable later.

If you want more clarity during divorce, subscribe for more family law and financial strategy conversations, share this with someone who needs it, and leave a review so more people can find the help.

If you would like to speak with one of our attorneys, please call our office at (503) 227-0200, or visit our website at https://www.pacificcascadelegal.com.

To learn more about how Ryan can help you or to learn more about Freedom Financial Services Group, you can view his website at: https://www.freedomfsg.com/ 

Disclaimer: Nothing in this communication is intended to provide legal advice nor does it constitute a client-attorney relationship, therefore you should not interpret the contents as such.

Transcript

Welcome To Modern Family Matters

Intro/Outro 0:01

Welcome to Modern Family Matters, a podcast devoted to exploring family law topics that matter most to you, covering a wide range of legal, personal, and family law matters with expert analysis from skilled attorneys and professional guests. We hope that our podcast provides answers, clarity, and guidance towards a better tomorrow for you and your family. Here is your host, Steve Altishin.

Steve Altishin 0:32

Hi everyone, I'm Steve Altishin, Director of Client Partnership for Pacific Cascade Legal, and today we have CPA and certified divorce financial analyst Ryan Finley to talk about creating a financial game plan when you're starting from ground zero in divorce. So, Ryan, how are you doing today? I'm good. How are you doing? Thanks for having us, Steve. I'm doing well. You know, it's sunny, it's the middle of January. So in Oregon, that's a that's a good thing. That's a good day. And um, so before we start though, Ryan, um, you want to talk to listeners a little bit about um yourself and and why you think this is really an important thing to know.

Ryan Finley 1:18

Absolutely. Thanks for again, thanks for having me. And my name is Ryan Finley. I'm the founder of Freedom Financial Services Group, and we specialize in divorce support, uh, forensic accounting, divorce support, litigation support. And what that means is um we typically help a client, we'll have a client come to us when they first starting out going through a divorce. Um, a little bit more about myself. I've been I've been a financial person for 35 years. I started off in public accounting and then worked for a company that bought and sold real estate. Uh I was in the new business development group of that company. So I did a lot of analyzing businesses in real estate and whether we should purchase them or not. So that gave me a good background as far as projections and income and expense budgets and the value of money and how things should be treated and looking forward and budgeting. So that, and then I was a CFO of um some real estate companies, some construction companies, some development companies, a little bit of everything. And so that was kind of my background up until about five or six years ago, and then kind of had a life change and decided to help a friend from a financial perspective. She was a divorce coach and had helping some clients and needed some financial information, and so I started helping them and really enjoyed helping people and helping people kind of what our discussion there today is is people that are thrust into a financial situation and they're not financial people and they're complicated financial situations. Even though they've been married 20 years and they've got these different things, they weren't involved in the finances, so they don't know what they have and they don't know what they're gonna have, and so or what they need, and so that's kind of it it's a it's a fulfilling work for me because the P the appreciation that people get going from gearing the headlights to having plan at the end of this.

Steve Altishin 3:39

Yeah, yeah, and it to me it feels like that's what you you're kind of talking about when you when you're saying starting from ground zero, you get a lot of clients who just literally they don't have they don't have the knowledge, they need to start learning.

Building A Marital Balance Sheet

Making Clear Choices Under Stress

Ryan Finley 3:57

And then you're exactly right. And so I'll give you a scenario that we see a lot. So we have you know, you have a young couple that uh man and and woman, they get married, they they meet, they get married, they both have careers. Five years down the road, they decide to start a family, one spouse stays home with the family, one spouse's career takes off. So they're both as important as the other. It's not one career is more important than the other. One may make more money, but one's raising the family, one's putting their values in there, one's taking care of everything. The ten years down the road, they decide to get a divorce. This one person hasn't had any exposure to the finances, they don't know what they haven't been involved. And all of a sudden, the person they trusted the most is suing them for a divorce. So there's all the uncertainties there, the it's an emotional situation. So what we try to do is come in and help this person. That's 80% of the time, that's our client, is this person, and so they they're they don't know, they don't know where to start. So they come to us first, and it's like and we help them understand what they have. We start pulling together financial documents and putting together a marital balance sheet, and it's that's everything they own and everything they owe, and just what the what the leftover is. Another thing is we show them, you know, where their so we go through their tax returns, we go through their pay stubs and just say, here's the income that you have coming in. Look, you we look at your tax returns. This is what you've made over the last four or five years, so and this is what you've spent. So I know this is a lot going on, and this person's uh not hasn't been dealing with the finances for 15 years, so we try to break that down into little segments and say, okay, on a monthly basis, here's the income that was coming into your household. Here's the expenses that was that that you guys were using for food, for mortgage, for gasoline, automobiles, insurance, dental care, you know, things like that. And so we do that different ways. One of the ways we do it is there's typically a lot of the families will have an account that we'll say it's the the operating account of the family. So that's where the paychecks come in, that's where the food gets purchased, the credit cards get paid out of that. So we'll take that and we'll upload, let's say, two years of those statements. And we'll look, we'll go through and we'll say, okay, everything paid to Croter is food, everything paid to Walmart is home, you know, everything paid to shell gas station is fuel. So we'll classify those expenses and put them into uh usually a 12 to 24 month spreadsheet. Say, okay, over the last 24 months, here's what your budget has been for fuel, here's what your budget's been for clothing, you know, and it it tells them they may not know, they know, well, okay, so the thing, some things are obvious. My utility bill's been this, my mortgage is this, my insurance is this, but there's other expenses they may not be aware of. How much do we spend for dog food or for medical care, things like that? And so we we show them here's what you've spent, here's what your historic the last two years of monthly expenses have been. And you know, they kind of see that as okay, that makes sense. And so that's the that's the first step. As you said, they come in and they're starting at ground zero, no knowledge, no financial information. So we're boon feeding them a little bit at a time and try to help them understand it. And we like it's I have a big monitor that we put all this stuff on, and I try to simplify it into a spreadsheet that shows them here's the money coming in, here's our income, and then there may be 15 different categories. So, you know, here's the like the mortgage, so they can see it, they see the spreadsheet, how they spend their money, and it kind of gives them a little peace of mind. Okay, I understand that. And as the divorce process goes, then we start making the plan on what do I need to live on? Well, you know, what how does this affect how does all this information affect me? You know, and one of the things the hardest thing to overcome on this, Steve, is this is a very emotional time. And you're we're asking them to make financially logic decisions in an emotional uh time. So we try to get them, you know, where they're it's not an emotional decision. It's like, well, I've got to have this, I gotta have this. Well, the impact of that decision now is this later. So we kind of project out what what that what that looks like. So we, you know, I tell them, I say, okay, let's say this lady's name is Elizabeth. Elizabeth, this is the we're we are now looking at the business of Elizabeth. You've got to take all your feelings, all your emotions, not all of them, but some of them, you know, because you are making a business decision today that's good that needs to affect how you live the next five years, the next 10 years. And so I know there's a lot of emotion on this, you know, but we've got to try to remove that. Well, there we there's a time and a place for that, and I know it's hard to do, but that's why I like looking at spreadsheets because spreadsheets don't have emotion to them, it's just facts. It's this this is what's coming in, this is what's going out. And so we we try to look at it that way. But you know, we try to walk them through and and through this financial situation just to kind of get them comfort and get their arms around it. And so that's kind of where we start, and kind of that's usually at the first part of the divorce.

The House Decision And Tradeoffs

Steve Altishin 9:55

But it that's it feels like that's where on a lot of of our clients the most anxiety lies not yet thinking about what am I going to do when I'm retiring, but what am I going to do next month because I don't can I afford to live here next month? I mean, there's it seems like you're you're kind of shoring up that short term. Yes. And so they they can at least start to think about uh stuff going a little bit forward. And and then you were talking about like the house, which uh it's really interesting because that is we find uh the most uh sentimental and non-hard financial uh decision that gets made. And they got and and some of these they have to stick like you said, they start after thinking about making fairly quickly because you know who's gets the house or other kids and all of that stuff is involved, and they always say, Well, no, I want the house, and that may just not be the best way to go.

Learning Basic Money Systems

Ryan Finley 11:02

You're right, and it may not be, but what a lot of them are trying to do, and and you know this, is that they want to leave it as normal for the kids as they can as possible. So staying in the same neighborhood, staying in the same school, the same friends. If that's financially possible, that's a good thing to do. And if it's not, you don't sacrifice your future to make that happen. You don't spend 10 years worth of cash for five years worth of living, you don't sell all your because there's two components to this. There's an allocation of assets, which is say we have houses and cars and investments. There's that part that you in a marriage you have to divide up. It's like, you know, and there's certain things that's give and take. It's I'll take this uh car, you take your car, I'll take this investment, and you try to balance it out as best you can. Sometimes if a house is involved, if a spouse wants to keep the house, they have to give up something else. And they could give up an investment or a CD or something that would be significant to them down the road, and you know, or or in order to keep the house, they may have to liquidate liquidate the CD to make those house payments. So there's things we look at that, and then of course, you know, there's we factor in you look at what if they if they work, they may not work, but you know if if alimony is involved or child support, there's calculations that do that. I know in Tennessee, the child support calculation, it's just a the state gives you, they have this formula, and it's you make this, she makes that, there's the allocation of number of days that you have over we'll say nights that this person gets and that person gets, and it's just a straight calculation on child support. We have this many kids, they're this age, and and this is how it works out. So that's a there that's a fixed number two. So you factor in that, you know, and then whether sometimes spousal support is justified and sometimes it's not. And so we go in and look at that. And in a situation that I describe, typically, if you have a working spouse and a non-working spouse, then there's typically there should be some type of spouse support there in most situations. But you know, you you have to factor that in. And if that's factored in, what does that look like? You know, how much does what are my expenses look like? What have her expenses looked like post-divorce? So that's the other thing we start doing. When we start looking at the budget, what it is now, you know, then what is the what does my budget look like if I keep the house? What does my budget look like if I get an apartment? It's gonna vary a little bit. There's certain situations that we haven't seen before. Um some of the home mortgages are still two and a half or three percent, you know, and so in certain situations now, it makes more sense for somebody to keep the house than they do to grant a three-bedroom apartment because their house payment may be $2,500 or $3,000, you know, to stay in that four-bedroom house, where a three or four-bedroom apartment may be more than that. But you know, those are situations you like look at on an individual basis. I'm not saying that's right, but you know, as the mortgage rates have gone up, anything purchased in the last two or three years, that's not, they wouldn't be able to stay in the house. It would be less expensive to stay in apartments. So you don't want someone to stay in a in a in a house and have to liquidate the assets we talked about that were being allocated earlier to be able to afford that.

Steve Altishin 14:48

Do do you ever get clients who are are you've kind of revealed, shown them all their ways that they can make a different decision or not? But their their question isn't necessarily what, it's how do I do it? I don't even know how to set up, you know, a you know uh a payment schedule or or a bank payment. It just we you know, you they can they can be very um intimidating when you just you know you you just think yourself dumb, but you're not because you just haven't done it.

Ryan Finley 15:23

You're right. And we we find that in the in the situations I've described, we see that a lot where the one spouse has handled everything. They don't know how to do a bank draft, they don't know how to go online and check their accounts. Some people do, but um we go through and we can help them with that. You know, we we charge by the hour, so we don't it's when people come to us, we have an hourly rate, and that's good for most people because you know they're not paying, we don't charge them a flat $10,000 or $8,000 or whatever. We track our time to the minute when we call we we have a software that we clock in when we start and we clock out, so they're paying for actual time, and this is time that we could do that as well. We you know, if if they want us to sit down and explain how this works or what to do, how to how to how to check my accounts, how to transfer money, how to pay these bills, how to what does that mean? You know, we'll we'll be glad to do that to them. We don't help them invest money, but we can introduce them to people and we'll say, well, I think, you know, I think this person will be good for you. You know, but part of what we do when we look at the settlement, we advise, you know, towards the end, if they go to mediation or they get a settlement statement, you know, we help advise this is what's best for you. This is what this financial situation, we think this is a good offer because of this. You know, we don't think this is a good offer because of this. So we kind of direct them a little bit from a financial perspective, but you know, it's their decision ultimately. But you know, we try to explain in simple terms why we think that's better and why that's better for them long term.

Retirement Splits And Hidden Taxes

Steve Altishin 17:07

Yeah, yeah, I know one of the hardest uh things to uh have an agreement on can be retirement accounts. And because they've got so many different things working on them depending on what kind of retirement accounts. And so they're tough. I mean, it's it's you need an expert, not necessarily like you said, to tell them what to do, but to show them, well, if you do this, this is what that's going to mean and down the road.

Ryan Finley 17:39

And I'm glad you brought that up because all things aren't the same there. They may look the same when they start dividing assets. So let's say, for instance, that this marriage, these this couple has a million dollars in we'll say Microsoft stock. So typically you would say, okay, you get a half million in this stock, and I'll get a half million, and we'll just go our separate way. That sounds fair, doesn't it? But when you start looking at it, if if I give you all the stock that I bought 20 years ago and my basis in it was 20 bucks, you're gonna have a huge capital gains tax on that money. So your money isn't $500,000 anymore. It may be $300,000 because of the tax effect of it. And mine may be $450,000 because I don't my the stuff I've got has little appreciation because my basis is higher in it. So that's a that's a great point you made because you we divide things up or we recommend dividing things up on a well, I'll say a lot basis. If we bought 10 shares in this lot, I get five, you get five. That way you have the same basis as in all those investments.

Bonuses Dissipation And Forensic Work

Steve Altishin 18:48

So I like that. That that's a great idea. It sounds like you work with the attorneys a lot. You're talking about mediation and settlement. And have you I'm just wondering how many instances you've come up with because I think it can happen where you got to teach the attorney. They want to go a different direction.

Ryan Finley 19:11

Yeah, and we've done that a couple of times. Well, well, more than a couple of times. It's uh there's some things that are complicated. There's some things that vesting bonus plans, sometimes where for your listeners, what a vesting bonus plan is, it may be something, let's say this year, 20, I'm gonna say 2025, even though we're in 2026, that I get a vested bonus plan this year. And so I'm gonna invest in three years over this bonus plan. So I'm gonna invest in 2025, 2026, and 2027. Let's say mid-year 2026, I get divorced. So there's a portion of the 2025 would be marital, part of the 2026 would be marital, even though it hasn't been paid. It may not get paid till the following year, but we need to calculate that value of what that accrued bonus would be, what the marital portion would be. So there's situations like that that I advise on, a lot of dissipation that I advise on. A lot of the attorneys will say, hey, we husband had this spout, this girlfriend, we know he took these trips, he bought her gifts. Can you go through the stuff and find that? We can do that. That gets added back to the marital estate, and then that gets divided. A lot of other things, it gets real complicated around real estate, business valuations. Uh, there's a lot of things that attorneys are very good at law. You know, some of them are financially savvy, but I don't a lot most of them don't have the expertise that a CDFA or a CPA or forensic accounting would have. We don't take business away from them. We supplement what they know and what we help them. As I mentioned, uh I think I mentioned earlier that you know, there's a lot of attorneys that we deal with that just turn over the discovery to us and say, hey, you do this. It's mostly financial, you put all this together, you pull these together, and then tell me how you, you know, what I need to know. And that allows attorneys to handle more cases and do a better job of them because we give them a summary and we do all this work for them. They're still reviewing it before it goes to the other side, but you know, that it's they that's it's a better use of their time.

Post Divorce Budgeting And Credit Cards

Steve Altishin 21:30

It the case as it goes through, and there's like you said, there's a settlement, there could be all the way to a trial, but in any case, there'll be some sort of a judgment. And things will be distributed, and all the stuff you talked about will be kind of in the judgment. Uh have you ever had someone come to you with like that judgment and say, What does this mean? Is there like any sort of uh uh post divorce uh help that you Can give people who've come from a divorce, and it says now, and even if you were working the it's like now it's time to do something. Can you not necessarily give you, like you said, investment advice, but you can point me in directions now to where to go?

Ryan Finley 22:15

And we do that, and what we hope we've done for this client is explained all that prior to the judgment. But in some situations, there's so much going on through a divorce, it's just sometimes they just don't grasp it because you know it's emotional, it's financial, you've got kids involved. It's just it's a storm, it's a divorce storm, and it's just hard to keep track of everything. But you're right, you know. So we do make appointments with them after after that. It's like, you know, and and what that looks like is we'll just sit down and we'll go back over their budget again. Here's your expenses. Here's, you know, we talked about this is what your new housing is gonna look like. You're gonna take some of this money, buy a condo, you're able to afford these payments. Where a lot of the education is is on credit cards, because some people get used to spending money on credit cards, and you've they've got to factor that in. Okay, credit card payment. If we schedule this amount for close, we're talking cash there. If you put that on credit card, that's an additional amount that you're gonna have to pay that's really in this budget, but you're putting it in this budget. So, you know, a lot of it is an education process with them post-divorce on what where they need to kind of watch their spending a little bit, you know.

Steve Altishin 23:35

Yeah, I think you told me when we were talking before about what we're gonna talk about was you don't just tell them what to do and then they do it, you you empower them in the future to to be able to do it themselves.

Ryan Finley 23:50

Exactly. That's exactly right. And like I said, from a perspective, I said I said this a little bit in my introduction. The thing that makes this so fulfilling to me is we get somebody at the start of this, at ground zero, and they come in and they have no idea, it's a panic, you know. My best friend's suing me, you know, the person I trusted most in life, you know, we're getting a divorce. So I who do I trust now? And so they come in and it's it's it's a storm. And you just see them grasp this and slowly build confidence. And we've explained what this looks like post-divorce, and then when the divorce comes and they understand better their financial situation, and and and it's just peace of mind that they get and the confidence you see them build over this process. It's like, hey, I I don't need I don't need to be dependent upon that person anymore. I've grown as a person through this process that I know I can do this. You know, Ryan's educated me on my financial situation. The attorneys have helped us guide this. I know I'm gonna be okay with these. I've got this, this is my schedule for the kids. This is what what I've got. And to see their confidence go through build through this process, and then when that divorce is final, they know now that they're gonna be okay at this. You know, where there was panic at the beginning, now there's confidence. The confidence is I'm gonna be okay, I'm gonna, my kids are gonna be okay. I know I have a plan. We're gonna live here. I've got the kids these days. This is my budget, you know, here's my assets, and I'm gonna be okay.

How To Reach Ryan And Wrap Up

Steve Altishin 25:30

Yeah, and that's that seems like the most important thing. You've taken them from fear to confidence, even if, I mean, even if in the divorce they didn't get everything they wanted, or there was they didn't uh disputes didn't all go away. They're there's still some, but but you've you've made them confident that they can go forward when they were not confident they could go forward before. Exactly. I love it. I love it. Well this was really, really, really good advice. You know, it it's uh it's amazing how you can take uh incredibly complex uh concepts and make people understand them. I mean, you know, and like I said, even people like me. So that's a that's a weird thing. So I'm I'm thanking, thankful you came on, you know, so much for being here today just to talk about this creating financial plan you know, when you're starting from scratch, and and again, and I really love what as you said, turning them from being fearful to confident. And it that that just goes beyond other things too, or confident in in in you know, all kinds of I'll be okay, as opposed to just oh, on this investment, I'll be okay. Right, right. I love it. Well, thank you for doing this today.

Ryan Finley 26:57

Well, thank you for having me. I appreciate it. I've enjoyed my time.

Steve Altishin 27:00

Oh, I have too. Everyone, thank you also for joining us today. Anyone, of course, with further questions on today's topic, can post it here. We or we can get you connected with Ryan. And saying that, Ryan, could you tell people how they could get a hold of you?

Ryan Finley 27:15

Yes, the best way to reach me is my website, and it's www.freedomfsg.com. Uh, and it's Freedom Financial Services Group, which is freedomfsg.com. And there's a button on there that's for a free consultation. They can click on that button and fill it out, and I'll turn around and get back in touch with them. If they're old-fashioned like me, they can reach me on my phone number 941-945-2846. I love it. I love it.

Steve Altishin 27:47

Great time. Thank you for being here today. And, you know, for everyone else. And until next time, stay safe, stay happy, and be well.

Intro/Outro 27:56

This has been Modern Family Matters, a legal podcast focusing on providing real answers and direction for individuals and families. Our podcast is sponsored by Lander Home Family Law and Pacific Cascade Family Law, serving families in Oregon and Washington. If you are in need of legal counsel or have additional questions about a family law matter important to you, please visit our websites at landerhome law.com or Pacific Cascade Family Law.com. You can also call our headquarters at 503-227-0200 to schedule a case evaluation with one of our seasoned attorneys. Modern Family Matters. Advocating for your better tomorrow and offering legal solutions important to the Modern Family.