Divorce: financial first steps

It’s true that about half of marriages end in divorce, and the rate increases the more times you are married. While the social & emotional toll of divorce is significant, the financial implications are far reaching & often have a lopsided impact, particularly in heterosexual relationships. Here are a few fast facts about the financial impact of divorce:

Average cost to divorce is between $15,000 and $20,000 (that’s just legal fees!)

Women over 50 who divorce face a 45% drop in their standard of living, while a man's

standard of living drops by 21%.

About one in five women fall into poverty as a result of divorce

About one in four women lose their health insurance for a period of time after divorce.

The decision to divorce is complicated & very personal. If you are in a place where you are considering divorce, or are in the early stages of that process, there are some things to consider so you are as financially prepared as possible.

Gather info

Collect all your financial documents like bank, investment, mortgage & credit card statements. I hate to say it, but do the legwork here. Your partner may not disclose honestly.

Owe & own

Figure out exactly what the bottom line is for all your assets & debts. Consider what should be split, sold or closed. Note where names & beneficiaries need to be changed. It’s also smart to update PIN’s & passwords.

Budget

Get real about your financial needs moving forward. How will your earning ability change? What new or increased expenses like child care will you incur? Will you lose health care benefits? When creating a new budget, resist the urge to lowball the number you really need to reasonably maintain your standard of living.

Do your homework / get a team

This information, while helpful, is in no way a substitute for legal advice. A qualified attorney can tell you exactly what your financial rights are and be the "heavy" when it comes to establishing boundaries. We also recommend a therapist or support group so you can work through the process in a healthy way.

Divorce is a heavy topic, but with the right team & a levelheaded plan, you can move forward feeling more prepared for your next chapter.