Portfolio Planning can Lead to Irreconcilable Differences

The judge had to ask the question, and we had to answer it in order to get our divorce finalized. It was all supposed to be pro-forma. "Why are you getting divorced?" the judge asked, his head buried in legal file folders.

"Irreconcilable differences," my wife, Sue, and I answered in unison as our attorneys recommended.

To our surprise, he followed up with a second question. "Differences about what?"

"Investment strategies," I blurted out. My attorney stomped me on my foot to shut me up. The judge was intrigued even though 20 other couples, with their attorneys, were waiting behind us.

Sue jumped in. "He believes in using only index funds in our portfolio. What a mistake! We need to actively manage our investments. Since the tech-stock bubble burst we've been losing money. And I dated a guy before this bozo [that was me] who is now a top mutual-fund manager on Wall Street. His fund has increased 13.2 percent a year even during the bear market. We should have given him our money."

The judge was definitely impressed. "I wish I could get my wife to be as interested as you are in our investments," he said. "Seems like you have a real winner here Hesh, so why are you breaking up?"

Just what I needed, the judge siding with Sue. I quickly counter-attacked. "Your honor, I believe in index funds," I said. "Why waste all that money having someone help you beat the market when the numbers say that over time no one really beats the market."

The judge really seemed interested. He wondered out loud, "You guys seem like a sophisticated couple, didn't you discuss this before you got married?"

I immediately answered. I didn't want Sue saying anything else that would make me look like a fool. "Your honor, when the topic of money came up, we agreed that mutual funds made the most sense and that we would max out our 401(k) s.

Honestly, we were just out of grad school, and we really didn't have much money. The topic just never came up again."

The couples behind us had given up hope of leaving soon; they sat down dejected as their attorneys pulled out their cell phones and began sending text messages to their secretaries telling them to cancel their morning appointments.

The judge called for a recess and invited us back to his chambers. Our attorneys were ordered not to accompany us.

"Listen," he said, "I have a solution. We are going back into court. Just follow my lead." Could we say no? I didn't think so. He pushed us out the door into the court room.

The judge followed us a few minutes later. He began solemnly, "After reviewing the facts and consulting both parties I have negotiated a settlement that they have agreed to." We had? My attorney gave me this look. You know the one that says: you got yourself into this mess, not me.

"As a judge in divorce court, I have heard flimsy excuses for couples to split. And personally I am against the no-fault divorce law in our Commonwealth. However, for the first time I have come across true irreconcilable differences in my court room.

"Adultery can be forgiven, just ask Hillary Clinton, but a spouse that hides his or her investment preferences prior to their marriage cannot. Fortunately, in the case before me, neither side knowingly covered up his/her investment orientation. Therefore, with the powers invested in me, I hereby grant their divorce.

"I am, however, outraged by the attorneys who profited from these clients and raised hopes that their differences might be overcome. I hereby order that all attorneys fees be returned and be placed into a trust fund for the children. I am also issuing a bench warrant for the arrest of the marriage counselor who bilked these two fine people of thousands of dollars in counseling fees in an ill-conceived plot to keep them together.

"Only one question remains, how to invest these funds to ensure an appropriate nest egg for the children. Before I rule, excuse me for a personal digression. Many years ago, while I was in law school at Columbia, I was fortunate to room with Warren Buffett. He was studying for his MBA. (Harvard had been dumb enough to have rejected his application.) I just gave him a call and told him of the case I was ruling on. In his typical homespun manner he said that he could not tell me how to rule on the legal issues. However, he strongly recommended that the trust fund for the children be invested in index funds.

"Now who am I, to disagree with The Sage of Omaha? I hereby rule that the children's trust be invested only in index funds."

Hesh Reinfeld writes a syndicated business humor column. You can read additional examples of his columns on his website: http://www.heshreinfeld.com Or contact him at hesh1@comcast.net

---

Want Your Savings to Earn a Higher Rate of Return? Try Internet Banking

Doesn't it seem like the only impressive numbers we've seen... Read More

Budgeting the Key to being Financially Stable

Single Mother's in need of Financial GuidanceBudgeting is key to... Read More

Vesting and Your 401(k)

Do you have a 401(k) retirement account? Are you vested... Read More

Financing Collectibles for Fun and Profit

With the advent of the internet and especially auction services... Read More

College Expenses: Seven Ways to Save on an Education

Many people graduate from college owing thousands of dollars in... Read More

Save Money on Gas

Gas prices have soared to unimaginable heights of late. Since... Read More

Strategies for Success

Holy Shenanigans! More STUFF?Loosing one's business due to lack of... Read More

Adverse Debt Levels Blight UK Consumers Personal Finances

Debt levels are at an all time high in the... Read More

UK Parents Inactivity Harming Their Children?s Future University and Mortgage Savings

The British government at the beginning of this year officially... Read More

Bank On It: Places to Hide and Invest Money

Today I passed a thermometer at a bank that read... Read More

Ways to Save Energy and Slash Electricity Bills

1. Lighting & Light Bulbs Install low energy light... Read More

Top 10+ Ways to Jumpstart your New Year?s Finances!

Of course, these don't have to be done in any... Read More

Personal Finance - Have Consumers Had a Belly Full of Personal Debt?

For months, we were trigger-swipe happy, putting our groceries, clothes,... Read More

The World is Not Enough - Calling for a More Ethical Approach to Personal Finance

At a time when the entire world's attention is focused... Read More

Succession Planning

Have you ever thought about what you are going to... Read More

Save On Food - Ten Tips

To save on food, be an opportunist. Buy what you... Read More

Why You Should Seek Professional Help With Asset Management

Everyone needs to maintain their lives. What I mean by... Read More

Avoiding A Nightmare On Renovation Street

You've decided you want a bigger, better and more desirable... Read More

Understanding and Controlling Your Finances

Have you ever wondered what it would be like to... Read More

Can You Afford Not To Look After Your Personal Finances?

Investing is a subject a lot of people don't want... Read More

Creating A Household Budget

Creating a budget can be a very difficult task. Although... Read More

Saving Money On Gasoline For Your Automobile

The gas that we fill our tanks with every week... Read More

Planning Your Financial Future

Millions of people give a lot of thought to financial... Read More

More Money? My Cup Runneth Over...But Im Still Thirsty

Most of us, especially those of us who have debtor's... Read More

Your Dry Cleaner?s Double Standard

Women are charged more for dry cleaning services. Don't fume,... Read More

Debt Management ? More Ways to Save on Gas Consumption

The price of gas continues to climb, and with continued... Read More

Help With My Annuity

The cries are heard from the distance, "I need help... Read More

Single Mother Resources Directs You Towards Success

As a parent you are bound to face a few... Read More

How To Place an Online Order for Checks ? It is Easy as 1-2-3

If You Have an Existing Account and 5 Minutes, You... Read More

How To Protect Yourself Against Identity Theft

Identity theft is a serious crime that continues to grow.... Read More

The Benefits of Banking Online

How many drawers did you have to look through to... Read More

Make or Break Your Retirement!

The Prudential has dubbed those who refuse to leave home... Read More

How To Get Ahead On A Low Income

Do you struggle from week to week trying to make... Read More