Money Lessons from Jim Nance

If you watch even a bit of sports on TV, it's likely that you've seen announcer Jim Nance. Well, he's in the news again, this time not for his on camera ability but because he's going through a messy divorce. It's a good reminder for us all that a divorce can have a substantial negative impact on one's net worth. So you better choose wisely when you get married.

Several financial issues stood out to me from the article linked above. Namely:

• Money is part of the reason for the split: "He maintained that the marriage ended as a result of his wife's lack of support for his career and her excessive spending."
• He makes a boatload of money: "He is attempting to protect much of his $7 million plus a year earnings."
• Is it really $7 million a year he earns? This adds up to more than that: "In addition to his $3.9 million annual salary from CBS, Nantz also makes $4 million in deferred compensation, which includes money he gets as the 'voice' of Titleist golf products."

• Did I mention that divorce is costly?: "His wife is seeking alimony for herself and child support for their 15-year-old daughter, Caroline, in excess of $1.5 million a year. She also wants to keep their six bedroom, six bathroom house on Imperial Avenue in Westport."
• Who you marry will impact your career: "In 2007, Nantz said he was offered $7 million to host the CBS Early Show, but turned it down because his wife opposed it."
• More on her spending problem: "He testified that while he was traveling around the country broadcasting sporting events, his wife was home spending vast sums of money. In nine years, she spent nearly $1 million at Ed Mitchell, a high-end clothing and jewelry store in Westport."
• She appeared to keep some financial things to herself: "And Lorrie Nantz admitted she often went shopping at Ed Mitchell, which is about a mile from their home. She has two accounts there, one in the couple's name and one under her maiden name, which she said she assumed her husband knew about."
• Is she a shopoholic?: "Just last month she purchased a $12,000 necklace at the store. But she admitted she couldn't recall what it looked like. 'I think it has some sort of stone,' she testified."

I'm not blaming her for the divorce (he had a mistress, after all!), simply highlighting the money-related issues associated with this break up. What a big mess!

Again, choose very carefully who you decide to marry since that decision will have a major impact on your ability to generate wealth. I'm not saying to select a mate based only on financial issues (heaven forbid!), just recognizing that it's one major factor to consider before you take the leap into marriage.

Comments

[Jon]

It blows my mind how often rich couples break up over money. I mean, seriously, if they split the money 50/50 into separate accounts they would be fine (at least monetarily). Who really needs 1.5 million per year to take care of a child? There are single moms out there who take care of their children for 1/100th of that amount.

[lurker carl]

Neither Jim or Lorrie Nantz are the same people they were 26 years ago. They changed along with their responsibilites to career and family.

However, the last two paragraphs of that article are very touching:

"The trial over, Lorrie Nantz stood in the lobby of the courthouse sobbing. Stepping from the elevator her husband saw her standing there alone and walked over and put his arms around her.

Together they stood, arms wrapped around each other, sobbing."

[Phil]

yup ...divorce sucks. I lost a lot in mine too. Next one for me will involve a pre nup.... feel the love.

[Crystal]

Divorce is a monetary and emotional hell. My husband and I have been married for less than 5 years. We have already watched 3 close sets of our friends divorce within that time. It hurt every single one of them so bad in every way. My best wishes go out to anyone suffering like that.

The advice we have heard is to marry someone with similar goals and morals, communicate about everything, don't hold a grudge, express love regularly, and to avoid the big screw-ups like cheating. That last part seems to come naturally if the first parts are achieved...who wants to cheat if the person they crave is their spouse?

I've also heard that you should never go to bed angry, but we have figured out that sleep can do wonders...things are put into perspective after a little break. Are you really going to stay mad about something stupid 6-8 hours later? If you are mad when you wake up, it means that it's probably important enough to discuss logically...

[MC]

I do have to address the last part of Jon's comment--about how Lorrie Nantz "could" raise their child on a smaller fraction of what he makes.

I'm puzzled by what this comment suggests. Is Jon suggesting that fathers who divorce should "only" have to pay some theoretical minimum towards raising their own children while keeping all the rest of their salary for themselves (even if they make a very large income?). Say, for example, perhaps only the bare amount to keep a child out of poverty and pay for college at a state school?

His ex is only asking for 1.5 million out of his income of 7 million per year---that's only about 20 %. Can't he afford to pay that small fraction towards the welfare of his own child? A lot could go into savings/trust fund for the kid, and there's college costs to consider you know. Also, the child support would only be for 3 years until the child turns 18. Why is that so outrageous to ask?

On sensitive on this because my own ex-husband's view is that since I have a good job (as he does), he shouldn't have to pay *anything* towards supporting out 2 children (who live with me, I have full custody). Fortunately, the state disagrees and garnishes his wages.

And FYI, I don't receive any spousal support and he was the one who had an affair and left with his GF, splitting up our family.

[LotharBot]

It says she spent close to $1 million over the course of 9 years at a high-end clothing/jewelry store. That seems like a huge number, but then, it's over the course of nine years -- a time period in which her husband made about $60 million. That's about equivalent to the wife in a median-income couple ($50k/year) spending $1000 on clothing and jewelry over the course of a year. It's high, but not ridiculously much so. It can certainly lead to tension, but shouldn't be the sort of issue that leads to divorce. Not unless the couple does a really poor job of dealing with it, and has other issues to go along with it.

[Chris]

I read in another article that the $1.5 million alimony is justified for the daughter....but it also mentions they have a full time nanny!!! And the daughter is 15!! This lady is clueless (who forgets what a 12k purchase looks like??)

[guinness416]

Your comment addresses what I was thinking but couldn't express properly MC, fair play.

Arguing whether millions of bucks a year are "enough" to raise your kid seems like a high class problem to me. It's a shame that they're all hurting, but perhaps one of the lessons missing from the original post is that prioritizing a job with so much travel - even one as glamorous as this guy's - will end in tears.

[kitty]

@LotharBot - I was about to make the same calculations, thanks for doing it for me. The guy seems cheap, really: makes more money that he could ever spend and doesn't want his wife to spend a relatively small percentage on clothes. I'd imagine if one leads this type of lifestyle one needs these fancy clothes: they are going to some receptions people like you and me aren't invited to...

In a sense it's less than what you got based on just math: the loss of $1000 for a couple earning $50k/year is a whole lot more noticeable than a loss of one million if you have 70 million. A couple earning 50K needs this $1000 for necessities, college fund for kids or retirement savings. This guy can afford all necessities, college for kids and he has more money than he could spend in a lifetime. Or at least any reasonable person could spend in a lifetime.

[ToddR]

I thought it was pretty lame the way he whined that his wife never supported his career. After she had a kid, he thought that she should continue to traipse around the country with kid, rather than putting her in school. What his wife spent annually is modest compared to the affluent neighborhood they live in. The $100m Phibro exec from Citibank lives in the same town. It sounded to me like Jim was justifying his cheating by blaming it on her, when he reality he should step up and say he was trading her in and didn't want to split the assets equally.

[Financial Samurai]

Ahhh divorce, the GREATEST WEALTH DESTRUCTOR of all time!

That's why it's always good to marry a loaded woman! Divorce then works in your favor.

[kenyantykoon]

hasn't this guy ever had of the magical document that at just a flash can make you keep every single coin that you own?? it is called a prenuptial agreement and it is quite a nifty document if i do say so myself

[Paul]

$1.5M may seem like approximately 20% of $7M (or is it $7.9M?), but don't forget about taxes. After Nance's income is taxed by the feds and state, I bet it is down to more like $3.5M. So if he gives that much in child support, which has no tax deduction for him, he will feel it. Plus, I object to obscene amounts of child support on the grounds that they do more harm than good in preparing the child to learn how to fend for themselves later.

But he get not pity from me for cheating on his wife, despite her actions.

[Strick]

He's had a long successful career. Hopefully the fact that all the talk is about future income and the only mention of assets is a house doesn't mean thats a significant portion of whats left to divvy up.

[Pop]

"Plus, I object to obscene amounts of child support on the grounds that they do more harm than good in preparing the child to learn how to fend for themselves later."

You think more than 1% of that money is actually spent on child care?! HA!

[Dirk]

Further evidence that I did the right thing by never getting married! Don't do it guys! There's nothing in it for you...only for women.

[MC]

In my state, having to pay child support has nothing to do with whether you were ever married to the child's mother or not. But marriage is important if a father wants child custody or much parenting time. Without marriage all custody reverts to the mother.

Makes sense to me! If you father a child, you should help support his or her raising financially at least.