If You Just Went Through A Divorce

Financial Planning Situation

Sally recently got divorced from her husband Harry. While Sally works at the local grocery store, her husband was the main bread winner for the family.

Here are the key questions she has:

• It is a constant struggle for her to make ends meet and support her children. Her credit card debt is increasing every month. She wants some guidance to manage her day to day financial life.
• While she did get some asset from the divorce, she is unsure of how best to invest it and give her children a bright future they deserve. She wants to plan for their future.
• She constantly worries what would happen to her children if something were to happen to her. She wants to figure out a solution to this issue.

These client stories are based on hypothetical, fictional situations.

Planning Process

Post-divorce planning refers to the process of creating a new financial plan and adjusting your financial strategies after your divorce is finalized. This is a critical step in ensuring your financial stability and achieving your goals as you move forward as a single individual. Post-divorce planning takes into account the changes in your financial situation and helps you make informed decisions about your finances, investments, and overall lifestyle. Here are some key aspects of post-divorce planning:

• Reassessing Financial Goals: Your financial goals may have shifted due to the divorce. Whether you are focusing on rebuilding your savings, buying a new home, or planning for retirement, we can help you realign your goals with your new circumstances.
• Creating a New Budget: A significant aspect of post-divorce planning involves developing a realistic budget that reflects your updated income, expenses, and financial obligations. Your budget should consider changes in living arrangements, child support, alimony, and other factors.
• Cash Flow Management: We can help you manage your cash flow effectively, ensuring that you have enough funds to cover your living expenses, debts, and savings goals while maintaining financial stability.
• Investment Strategy Adjustment: Your investment strategy may need to be revised to reflect your updated financial situation, risk tolerance, and goals. We can help you reallocate assets, adjust investment contributions, and plan for long-term growth.
• Retirement Planning: Post-divorce planning may involve recalibrating your retirement plans and contributions. We can help you estimate how the divorce may impact your retirement savings and recommend adjustments as needed.
• Estate Planning Updates: With your marital status changed, you may want to review and update your estate planning documents, such as your will, trusts, and beneficiary designations, to reflect your current wishes.
• Debt Management: If you acquired debt during the divorce or need to manage existing debt on your own, we can help you develop a strategy to pay down debt efficiently and minimize interest costs.
• Insurance Review: You might need to update your insurance policies, such as health, life, and disability insurance, to ensure you have adequate coverage for your new circumstances.
• Emergency Fund Planning: An emergency fund becomes even more crucial as a single individual. We can help you determine the appropriate size of your emergency fund and set up a plan to build and maintain it.
• Child's Education Planning: If you have children, post-divorce planning may involve revisiting education funding goals and strategies for saving for their future educational expenses.
• Long-Term Financial Independence: We can assist you in creating a roadmap for achieving long-term financial independence, which might include strategies for growing your wealth, achieving homeownership, and planning for retirement.
• Emotional Support: Divorce can have emotional and psychological impacts. We can provide support by offering guidance, a listening ear, and practical strategies to help you regain financial stability and move forward.

Post-divorce planning is essential for helping you transition smoothly into your new financial reality. Working with a financial planner who understands the intricacies of divorce-related financial matters can provide you with a clear roadmap and the confidence you need to build a strong financial foundation for your future.