A recent study found that 46% of divorced women said that divorce brought with it financial surprises. In many marriages, husbands are primarily responsible for managing and investing money with women uninformed about their finances and ill-prepared to move forward. Add to that the high cost of divorce and many women (and men) discover they will be struggling financially more than they thought.
Some of the most common surprises women reported were:
- Being unaware of the total size of their marital debt
- Not anticipating they would have to return to the workforce
- Assuming child support and/or alimony would be higher or last longer
- Assuming they could keep the marital home
- The staggering cost of health care insurance
- Underestimating the cost of getting a divorce
What’s the solution?
During marriage, it’s important for women to be informed about the family finances and to get educated on financial basics, including long-term financial planning.
For those who may be headed toward divorce, a financial expert can provide invaluable assistance. That’s where a collaborative divorce process can be particularly helpful.
In a litigated divorce, the parties will often have their own financial experts to advocate for their position, but the process is adversarial and expensive as these experts battle each other. In a collaborative divorce, the parties still have their own lawyers, but they collectively work with a team of advisors including a financial neutral. The financial neutral provides detailed financial planning, organizes documents and explains current and projected income, assets and liabilities. By analyzing and explaining the options available to the parties, spouses can come to an informed and amicable financial settlement.
Collaborative divorce also helps to avoid a winner-loser mentality. Instead of fighting to “win,” the parties work together, which not only leaves them in a better financial situation but helps prepare them for a new economic reality as separate households.
Collaborative divorce is not right for everyone. That’s why it is important to seek out professional help before a choice is made.
Contact me to discuss your divorce options.