Hulk Hogan, for those of you who don't know him, is a wrestler. His real name is Terrence Gene Boella and currently works for World Wrestling Entertainment (WWE). He has twelve world championships. Impressive, right?
News of his divorce got out recently, and I was really impressed with how much this example can teach us about personal finances. The reason for the divorce was a series of infidelities that his partner couldn't take anymore, making her take him to the Supreme Court, resulting in a monthly alimony of $40,000 per month!
But other than being a very sad story, what does this divorce teach us?
According to many experts, divorce is one of the most expensive things. The average divorce doesn't cost $40,000, but I assure you that it will be a hard blow to your finances. In fact, the standard cost of a divorce is $700 for the entire process and if there are issues that make it bigger (like in Hulk's divorce) it'll be between $800 and $1200.
So, what can we do to prevent this?
First we must always try to marry the right person. Love is indispensable in a marriage, but it isn't everything. Do you know and agree with your partner's financial habits? How do they take on debt? Are they willing to learn how to invest? It's important to clarify all these things before you begin your life together, even if they’re a little “control freak” in nature.
Then, there's the importance of communication. Belive it or not, Hulk Hogan found out about his divorce when a reporter from the St. Petersburg Times called to know his impression and comments about it. How is this possible? It's important that you communicate with your partner every day about the things that concern you in matters of love, understanding and finances.
What are the main reasons for divorce?
Infidelity: Hulk's example falls into 17% of divorces that are the result of infidelity, and all kinds of infidelity. Check out my comments about financial infidelityhere.
Abuse: physical or mental abuse is another major cause of divorce.
Incompatibility: not being completely sure of who you’re marrying and not thinking it through. It's necessary for you to know your partner well before you embark on the journey of marriage.
Money: differences in the perception of money, debt and savings are some of the main reasons why marriages end.