By Delta Jones
On occasion, I have clients who seek my counsel on how to pick up the financial pieces after divorce. As if separation from a spouse isn’t stressful and emotional enough, divorce can also present a whole new set of financial challenges. In an ideal world, parties divide their assets, currency, property, etc. equitably and move on with their lives. Most times, this is not the case. Here are a few financial tips that can potentially help navigate the sometimes difficult waters of divorce.
- Have a conversation with your financial advisor. Your financial advisor is one of the key persons who should have your pertinent financial information stored in one place. Items such as 401K account information, stock investments, insurance policies, names of beneficiaries, etc. should be readily available. This data should be reviewed to determine what is eligible for division between parties, updating of ownership or total cancellation.
- Consider retaining legal counsel. Every divorce is not the same, and retaining legal counsel is common practice. An attorney can help ensure that his or her client receives a reasonable settlement, especially when both parties cannot fully agree. There are also instances where one spouse has money and/or assets that have not been disclosed or negotiated for distribution. These matters should go through the legal system for proper resolution.
- Rework your household budget. Divorce can result in more or less household expenses. It is helpful to write out anticipated monthly bills. Be realistic about your new financial norm, and determine what adjustments need to be made if any.
- Update accounts and beneficiaries. In order to protect access to bank accounts and other financial assets, be sure to update the names and beneficiaries.
- Update your personal insurance coverage. Review your policies to ensure that you are not paying coverage on individuals or items that are no longer your responsibility.
- Create an emergency reserve fund. As a newly single person, having an emergency fund becomes more important since there is no longer reliance on two incomes. Ideally, an emergency fund should cover 3-6 months worth of expenses.
There are other actions divorcees can take to regroup financially including checking your credit score and updating information with the Social Security Administration. While it may take time, there can be financial stability after divorce. If you have not done so, connect with a trusted financial advisor who can help identify even more ways to get your finances on track.
At Atled Financial, we are always looking for ways for you to improve your bottom-line. To schedule a complimentary consultation or a presentation to your group or organization, call 219-513-3710 or email firstname.lastname@example.org and mention this column. Topic ideas for this column are welcome!
*Securities and advisory services offered through Woodbury Financial Services, Inc., member FINRA/SIPC. Insurance services offered through Atled Financial Group 717 B Main Street, Schererville, IN 46375 which is not affiliated with Woodbury Financial.