Financial Planning and Investing during COVID
Our founding attorney Sarah J. Jacobs, Esq. interviews Certified Financial Planner Scott Greenberg from SJG Private Wealth Management.
Scott Greenberg: As you mentioned, I am a certified financial planner which part of that means that I act as a fiduciary for all of the families that we are blessed to serve and I founded SJG Private Wealth Management about 10 years ago to better serve individuals and families successful responsible ones through their personal financial matters. So, part of it managing their money and part of it helping them take a goals-based approach to reach their financial destination.
Sarah: You and I have a similar type of job in the sense that people come to us trusting us with one of the most important things in their world for you and me it is money but it is also family and security and safety. I think our worlds crossover in that respect and one of the questions that I have for you and that a lot of my clients have for me is here we are in the middle of this unprecedented time and we are negotiating still divorce agreements and divorce settlements a lot of which include equitable distribution of assets and liabilities. For some of us we were in the middle of negotiating a very complex settlement agreement that contained assets in the market and also broke lose for us and clients are now asking, can we make these deals, what can we do, how do we recover from this how does this affect our divorce settlement and of course, I realize that each circumstance is nuanced but what would you say to those people? How would you give those people advice about moving forward and creating a strategy for themselves to be able to accomplish the goal which is to get divorced?
Scott: Yes, obviously I can not just say it explicitly because I know that we are in a highly regulated industry that I am not in a position to give legal advice. But having said that, one of the things that is helpful in terms of assets. You have to understand that there is different types of assets, so obviously there are ones that depreciate. There are ones that appreciate. There is streams of income and cash flow that go both directions and then there is present value and in order to see what is equal to one or the other you have to be able to convert them back and forth. You have to know there is a pension here that is a thousand dollars a month. There is a portfolio here that is half a million dollars and is not growing anymore, well which one is worth more? Well, it depends on a lot of stuff but you have to be able to regress those back and it depends on the age of the person, is it guaranteed for life, is there an inflation? All this different stuff but, the point is, you have to be able to convert these assets into numbers in order to compare them, and then some may find more value in the other so it is a very difficult circumstance. And then the other part of it is taxation. So one of the benefits of liquidating something like a security portfolio or a stock portfolio when the market is down is the taxation is less than it would be otherwise. So, there are ways to think about how to obviously if you have retirement assets than if you are doing something like a quadro you do not have to pay some sort of penalty and stuff like that but if you are going to be liquidating stuff in order to make the parties equitable, then you just have to understand the tax treatment but there is things to use to your advantage during these volatile times. I would say the biggest thing is that in situations where there is a spouse that might kind of control the family finances and then there might be a spouse that does not and it could be people have all different ways to of setting up their household finances, his, hers and mine, and there is whatever. So, everybody is a little bit different in that way but when you are getting divorced and when you are trying to get that into conclusion, you really have to know what is available. SO I would say have all the information, educate yourself on what is available or is this house you were going to live in it, is somebody to take it? Are we going to sell it and then we are going to split up proceeds and then where are we going to live? are we going to rent or are we going to own? That is a big decision in itself right now. It means interest rates are very low, mortgage rates are probably going to be very low for a while. But there is a lot of serious questions about real estate also, so it just adds the uncertainty in the economy; it is a very uncertain time to obviously get divorced which is a part of people´s life where they all almost owe it, they almost always feel that there a piece of them missing and they just have to pick up the pieces and it is very difficult but, I think that I would say. You have to be able to convert the assets into numbers to compare. You really need to know what you own and why you own it and then when the dust settles and it is finalized you are left with these assets that are yours now but kid of now what do we do with them. If you are not the expert find one. Find one that you know, and you like and you trust and is hopefully a fiduciary and have a conversation with them about your goals and objectives because again, there is an entire universe of asset classes that people just usually are not that familiar with. You need to create a retirement income stream for yourself that you can not outlive. That is a different goal than if you just have a chunk of money and the game plan is we may never spend it. We just want to grow it as fast as we can for the next generation or philanthropically or something like that.
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We at Jacobs Berger, all of the staff is committed to providing guidance and assistance to handle your financial-related issues. Our attorneys’ team is experienced in helping clients across Madison, Randolph, Tewksbury, Morristown, and the greater Morris County area in all Family Law cases.
If you have questions about any financial issues, please do not hesitate to contact our Morristown, NJ office at (973) 710-4366, and reach out to schedule a strategic planning session and discuss your situation in a personal way.