“What’s a reasonable settlement for me?” a wife said, repeating the question we’d asked her in divorce mediation: “Marry rich.”
“Well we can’t put that in a separation agreement!” her husband angrily responded. “Just tell me what you want.”
But it was clear the wife was struggling with the fact that the terms she really wanted in an agreement were impossible – to keep the couple’s million dollar mortgage-free house, and to receive $8,000 a month from her husband to keep the house running.
Unfortunately, the house was this couples’ only marital property. And the husband made $130,000 a year. So what the wife desired was all the marital assets and all of her husband’s salary.
It is easy to dismiss this woman as just selfish. But she was also deeply afraid.
She couldn’t get beyond the idea that the home she’d loved and raised her children in wouldn’t be hers.
Her husband made what he thought was a generous offer: he’d give her the house, forgoing his $500,000 share and in exchange he wouldn’t pay her maintenance (alimony) – which came out to $350,000 over 18 years, calculated according to the new New York State maintenance formula and statutory recommendations.
But this wasn’t a realistic solution. The woman couldn’t carry the costs of the house. As a stay-at-home-mom with grown children, she was fifty and back in the workforce making minimum wage.
The real solution was one this wife couldn’t accept – the house had to be sold, with each party using the proceeds to find something cheaper.
This is an extreme example of what almost every couple we see in divorce mediation faces. In New York City rents are astronomical and the price of apartments out-of-this world. Unless a couple is extremely wealthy, it will be the rare case that either party can maintain their previous life style after splitting up.In mediation, we help couples adjust to their new reality of two households:
- We focus couples with unemancipated children on maintaining the children’s lifestyle. This doesn’t always mean keeping them in the family home. Often in New York City, the most important factor is keeping the kids close to their schools and friends, even if the custodial parent has to downsize to a smaller apartment. (We’ve had more than one parent gladly sleep on a living room couch to keep their children in the same neighborhood.)
- We help couples fill out detailed budgets: There are many expenses that married couples take for granted. By closely reviewing how they’ve spent money in the past, parties find the lest painful ways to cut back. (Yes, selling the car, used only weekends in summer, will save thousands of dollars a year; yes, eating out two days a week instead of six saves close to $500 a week!)
- We encourage parties to talk to financial advisors: A professional can run numbers and break down the real costs of moving forward without a spouse.In mediation, it’s important to explore realistic ways to minimize the financial worries for both parties when splitting up their household. Holding out hope for a rich spouse should never been seen as the only way out.