The divorce rate in the United States is one of the highest in the world. Even though it is somewhat common, the process is not an easy one. In addition to dealing with the emotional trauma of ending the relationship, worrying about the judgment of friends and family, and figuring out how to tell the kids, women often face the extra burden of significant financial concerns.
Here are three of the biggest challenges for women going through divorce:
Money is the thing that divorced women worry about the most. One of the reasons for this is that women tend to face a post-divorce drop in income, in some cases making 20 percent less than they did before their marriage ended while men actually see an increase, earning 30% more according to research from the London School of Economics.
While individual circumstances might make it difficult to improve their situation, there are some things women can do to make sure they have the best chance of surviving divorce without financial devastation.
First, take a look at the financial situation before deciding on divorce. Examine bank statements, credit card bills, tax returns, retirement accounts, and anything of value. If you feel your marriage is heading toward divorce, start saving money in your own separate savings account.
Try to improve your credit score as it will likely drop after the divorce. If you don’t already have your own credit card, apply for one. Use it for small purchases and pay it off every month to establish a credit history without paying any interest. It’s also a good idea to close any joint cards so that you cannot be held responsible for any additional spending your spouse may engage in.
Make a new budget. Try to add something to your savings and retirement accounts as you are able to. If you depend on your spouse for health insurance, make sure you figure out a way to get yourself covered and discuss coverage options for your children.
Get a good attorney and make sure you get the assets that you deserve. If you’re worried about taxes, consult an accountant. You don’t want to miss out on something because you didn’t have the right guidance.
2. The Kids
A lot of divorced mothers worry about whether or not they’ll have enough money to care for them and put them through college. Another huge concern is that you won’t be able to give them what they need throughout this difficult situation.
One of the best things any mother can do for her children is to take care of herself. Make sure you talk to someone if you’re feeling overwhelmed, whether it’s a therapist, minister, or support group. If you want help preparing for your children’s future, talk to a financial planner to get started right away.
To make sure your children get what they need during this time, talk to their teacher and school counselor so the school is aware of what is going on. Consider counseling or group therapy so you can work through this difficult time together. Be there for them and encourage them to talk openly about their concerns.
Millions of women cannot quickly and easily find a safe home after a divorce, something made even more difficult by their limited budget. When looking for a new home, be sure to budget for everything from the mortgage payment to increase utility bills and any maintenance or homeowner association feed before deciding whether or not you can afford it.
If you’re moving to a new neighborhood, do your research. Make sure the neighborhood is safe, the school system is sufficient, and that your kids will like living there.
Divorce is not easy and while you can’t do much to plan ahead to heal your broken heart, there are some steps you can take to avoid some of the serious financial problems that come along with divorce. Be proactive, plan, and protect yourself.
This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. Investors should consult their investment professional prior to making an investment decision. Expressions of opinion are as of this date and are subject to change without notice.