Going through a divorce is like driving through a snowstorm in the middle of the night on some forlorn country road.\u00a0 Congratulations for surviving the harrowing ordeal.\u00a0 Now it\u2019s time to turn your attention to a brighter future.\u00a0 We have worked with many divorced women, and we offer the following strategies to help you gain financial independence.<\/p>\n
The best place to start is to take stock of where you are financially.\u00a0 What assets did you walk away with after the divorce (e.g. the house, retirement accounts, savings, investments, property)?\u00a0 Did you end up with some debt (e.g. mortgage, educational loans, credit cards, vehicle loans)? What are your sources of income (e.g. alimony, child support, wages\/salary from work, rental income)?\u00a0 What are your expenses?\u00a0 It would be wise to distinguish between basic living expenses (food, clothing, shelter, and utilities) and discretionary expenses (e.g. dining out, entertainment, vacations, etc.).<\/p>\n
Now that you know your assets and debts and your income and expenses, you can start planning for financial independence.\u00a0 Your highest priority should be saving for retirement.\u00a0 You should figure how much you will need to save each year for retirement and set those funds aside before you spend on anything.\u00a0 Then use the remainder of your income to pay for your basic and discretionary expenses.<\/p>\n
If you have been out of the workforce for a while, think about returning to work.\u00a0 Working will provide income and reduce your need to draw upon whatever resources you have after your divorce.\u00a0 You may need to earn new credentials, refresh your skills, or update your experience to secure the kind of work you want.<\/p>\n
There are lots of financial risks<\/a><\/strong><\/span> that you need to think about as you look to the future, and you need to plan for them.\u00a0 You could become sick or hurt and need medical care.\u00a0 So, make sure you have adequate health insurance to pay for your medical expenses.\u00a0 Also, make sure you have disability insurance that will provide you with income if you are not able to work.\u00a0 While there are disability benefits through Social Security, it is very difficult to qualify for them, and you should not count on them.<\/p>\n Women live longer than men, and they often arrive at retirement with less money than men.\u00a0 You can do a few things to avoid the risk of running out of money and ensure your financial independence.\u00a0 Plan on taking Social Security as late as possible (age 70), because for every year you wait, your benefit will increase by 8%.\u00a0 Also, consider using an annuity in conjunction with Social Security to provide additional guaranteed income that you cannot outlive.<\/p>\n <\/p>\n The reason many women struggle financially after divorce is that they make mistakes<\/a><\/strong><\/span> with their money.\u00a0 You may feel compelled to help your children and grandchildren financially.\u00a0 Support them in as many ways as you can.\u00a0 Just don\u2019t let that support threaten your financial independence<\/a><\/strong><\/span>.<\/p>\n You should only use credit cards as a means of convenient payment.\u00a0 Americans have grown accustomed to carrying costly balances on their credit cards.\u00a0 Experian<\/a><\/span><\/strong> reported that the average credit card balance in 2019 was $6,194.\u00a0 The number has been increasing for several years.\u00a0 You should pay off your credit card balance in full and on time. The interest on credit card balances and the fees for late payments are extortionary and should be avoided.<\/p>\n It can be tempting to splurge when some exciting opportunity pops up.\u00a0 It could be a flashy, new car, a beach vacation, a piece of art, or whatever might strike your fancy.\u00a0 When this happens, please be careful.\u00a0 You should have a budget and if the expense you are considering is not in your budget, you will have to either make room for it in your budget (i.e. spend less on something else) or skip it.\u00a0 Most Americans buy things they fancy and figure out later how to pay for them.\u00a0 Your financial independence depends on your ability to stick to your budget.<\/p>\n Women live longer than men and if they need assistance with basic living activities, they need it for longer than men do.\u00a0 Paying for care is very expensive.\u00a0 So, to minimize the odds that you will eventually need help, take care of yourself.\u00a0 Eat well.\u00a0 Exercise frequently.\u00a0 Drink alcohol moderately, if at all.\u00a0 Keep your mind active.\u00a0 Practice your religion.\u00a0 Meditate.<\/p>\n If you have a family history that suggests you may need professional care, plan for it.\u00a0 You could save enough to pay for it, or you could purchase long term care insurance to cover it.\u00a0 Paying for expensive care is one of the greatest threats to your financial independence.\u00a0 So, plan for it.<\/p>\n If all of this seems a bit overwhelming, you should consider hiring someone to assist you.\u00a0 If you are in the midst of divorce or just emerging from it, look for a Certified Divorce Financial Analyst<\/strong><\/a><\/span> (CDFA\u00ae). \u00a0 The role of a CDFA\u00ae is to help you (and your attorney) navigate wisely the financial aspects of divorce.\u00a0 If your concerns are broader than those involved in divorce, look for a Certified Financial Planner\u2122<\/strong><\/a> <\/span>(CFP\u00ae).\u00a0 A CFP\u00ae is a fiduciary (i.e. required to act in your best interest) and has knowledge, skills, and experience in a broad array of financial planning topics.<\/p>\n Over the years, several of our divorced women clients have told us that they fear becoming a \u201cbag lady\u201d late in life.\u00a0 They usually express this worry with a bit of a nervous laugh.\u00a0 We get it.\u00a0 Single women are more likely to live in poverty than men or couples, particularly in old age.\u00a0 But, if you follow the strategies we have shared, you can live in financial independence.<\/p>\n","protected":false},"excerpt":{"rendered":" Going through a divorce is like driving through a snowstorm in the middle of the night on some forlorn country road.\u00a0 Congratulations for surviving the harrowing ordeal.\u00a0 Now it\u2019s time to turn your attention to a brighter future.\u00a0 We have worked with many divorced women, and we offer the following strategies to help you gain […]<\/p>\n","protected":false},"author":2,"featured_media":4007,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","_mi_skip_tracking":false,"footnotes":""},"categories":[150,3,6],"tags":[49,66,156,107],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/springwaterwealth.com\/wp-json\/wp\/v2\/posts\/4006"}],"collection":[{"href":"https:\/\/springwaterwealth.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/springwaterwealth.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/springwaterwealth.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/springwaterwealth.com\/wp-json\/wp\/v2\/comments?post=4006"}],"version-history":[{"count":0,"href":"https:\/\/springwaterwealth.com\/wp-json\/wp\/v2\/posts\/4006\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/springwaterwealth.com\/wp-json\/wp\/v2\/media\/4007"}],"wp:attachment":[{"href":"https:\/\/springwaterwealth.com\/wp-json\/wp\/v2\/media?parent=4006"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/springwaterwealth.com\/wp-json\/wp\/v2\/categories?post=4006"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/springwaterwealth.com\/wp-json\/wp\/v2\/tags?post=4006"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Contact us today to learn how a Certified Divorce Financial Analyst\u00ae\u00a0can help guide you and answer your financial questions before, during, and post-divorce.<\/a><\/span><\/strong><\/h2>\n
Avoid Financial Mistakes<\/b><\/h2>\n
Stay Healthy<\/b><\/h2>\n
Get Professional Help<\/b><\/h2>\n