Newly Divorced Individuals

The Marriage is Over But Your Financial Security Shouldn’t Be

No one likes to talk about divorce, but considering data compiled in 2022, nearly half of American marriages will eventually end in divorce or separation. And since approximately 22% of those couples cite financial incompatibility or struggles as the primary reason for parting ways, it stands to reason that in such a tumultuous time, you’re going to need sound financial planning advice. 

Unless you are exceptionally wealthy, divorce will impact your personal finances. A 2017 survey by Bankrate found that the average divorce in America costs around $15,000, with more contentious situations costing nearly $100,000. Attorney and court filing fees, refinancing costs (if you and your spouse jointly own property), and paying for various forms of requisite evaluations are but a few of the many costs associated with divorce. Some of these are inescapable, but there are ways to make the financial part of the divorce process less expensive and less mentally taxing.

If at all possible, consider undergoing mediation or arbitration prior to pursuing litigation. Mediation is the least expensive option, as all you must do is hire an impartial mediator as opposed to a lawyer (though you still may opt to hire a lawyer for this process, as well). Arbitration involves finding an arbitrator who acts as “judge” of your case. Arbitration outcomes are legally binding as a public judge must approve your arbitration, whereas mediation outcomes are not legally binding. Aside from the financial benefits of staying out of court, avoiding litigation can also save you from the undue heartache a divorce hearing can incur for all parties involved. 

A divorce can be the most impactful financial event you ever experience and although financial planning may not top your mental list of to-dos in such a time, there will never be a more important moment to seek sound financial advice–especially if you are a woman. In a study completed in 2018, the Association of Divorce Financial Planners found that only 6% of survey respondents reported working with a certified divorce financial analyst (CDFA). From data collected in the same study, 61% of women said they wished they had been better informed about how utilizing the services of a CDFA would have made their divorce process more manageable. 

CDFAs help with a wide host of issues including–but not limited to–the following:

  • Collecting and helping you to understand financial and expense data
  • Developing personalized long and short term budgets
  • Setting retirement targets and making plans to achieve them
  • Discussing investments and assets (both obvious and the potential of hidden assets)
  • Determining what kind of lifestyle you want and can afford

If you are affected by divorce, you need to know what the best financial course of action will be for your personal situation. Schedule an introductory call with a CDFA at WR Wealth Planners today.  You deserve skilled professionals who are empathetic to the emotional minutiae that divorce brings and our team is here to help you navigate your complex needs.

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