Posts in Family Finances

Women and Investing: Facts, Myths, and Financial Self-Care

August 11th, 2016 Posted by Budgeting, Family Finances, Investment Strategy, Investor Behavior, Life Planning, Marriage and Finances, Retirement Planning 0 thoughts on “Women and Investing: Facts, Myths, and Financial Self-Care”

Women control $5 trillion in investable assets in the United States, and the potential for future growth is enormous. Today, women represent more than 51 percent of the workforce and are starting businesses at twice the rate of men. On the flip side, men’s retirement account balances average more than 50 percent higher than women’s. The gender retirement gap is further compounded by the fact that women tend to live an estimated five to six years longer than men.

The data shows that, on their own, many older women have less money saved to draw from, as well as higher expenses. All too often, this dangerous combination results in financial insecurity. It’s imperative to understand why this gender retirement gap exists, and what can be done about it.

  • The Gender Pay Gap: Statistically, for every dollar men take home, women earn 79¢. That means women will make an estimated $530,000 less over their lifetimes, thus also reducing the amount of money they have to invest. We need to address this inequity as a society, but in the meantime, women in the workforce should not shy away from asking for a raise.
  • Family Responsibility: Many women take more time off work than their male counterparts to raise children or care for elderly parents. Not working outside the home means more than just losing a paycheck. It also means having less disposable income to invest in the long term and may translate into lower Social Security benefits.
  • Cost of Living: Life as a woman actually costs more. For starters, think wardrobe and personal care. And while there may be little we can do to reduce some of these costs, there are still ways to combat this problem. For instance, women often end up paying more for items such as mortgages and cars. By vigilantly researching the best loan rates available, women can negotiate from a stronger position and potentially reduce excessive costs over a lifetime.
  • The Gender Investment Gap: Although women actually save more of their disposable income than men, they tend to invest less of it, leaving a lot of their money in cash or low-yield savings accounts. But when women put together personal plans to bridge the gender investment gap, it can have dramatic, positive consequences for their financial lives. Before we explore ways to move forward in a positive direction, let’s talk about why women often show hesitancy when investing. It’s likely that they’re buying into one or more of the many myths about women and money.

Negative stereotypes and myths about women and finance:

  • Men are better investors than women. Not so. Research shows that when women invest, they tend to be highly successful, outperforming men. Not to mention that funds managed by women consistently outperform their alternatives.
  • Women are too risk averse to invest successfully. True, many women are risk averse. But wait. Can’t caution in investing actually be a virtue that helps you better weigh your options and avoid making poor or rash decisions? Yes – so long as you keep in mind that some risk must be taken in order to realize the returns needed to grow your wealth. This shouldn’t present a problem for women, or any investors, when the connection between their values, goals, financial plan and investments is clear and all are in alignment.
  • Women don’t have enough financial education to make a financial plan. Although this myth represents a gross generalization, there’s no denying that everyone could benefit from getting a better financial education. Not having one, however, has never stopped men from investing.

Moving ahead with saving and investing as a form of self-care:

  • Budget: Try to think of budgeting as less about numbers and more about personal awareness. It’s a check-in to see whether you are spending on the things that matter to you most. Set boundaries that ultimately will set you free to create and pursue the life you desire.
  • Save: Putting aside money is actually a way of caring for your future self. The rule of thumb is to save 15-20 percent of your income, but if you can’t do that, save as much as you realistically think you can. Just as you go in for regular health check-ups, do frequent check-ins on your financial well-being. Ask yourself if there isn’t more you can do to protect your financial welfare.
  • Invest: The need to invest can be compared to our need for exercise. We exercise to fight the corrosive power of aging and maintain our health. We invest to fight the corrosive power of inflation and maintain our financial health. Your savings should be invested, rather than kept in a money market fund with low interest rates. Otherwise, inflation will erode the value of your assets.
  • Insure Yourself: It’s a little-known but important statistic that 80 percent of men die married while 80 percent of women die single. Life insurance and long term care insurance should be seriously considered in women’s financial planning.
  • Take Responsibility: You would never cede big decisions in your life to other people, like who to vote for or how to take care of your kids or aging parents, so make sure that you are also participating in financial planning. It is highly likely that, someday, you will be the only one responsible anyway. A study performed by the National Center for Women and Retirement Research estimates that 90 percent of all women – single, divorced or widowed — will be in charge of financial matters at some point in their lives.

To create the best possible future for yourself, start planning for and investing in your future today. We would be happy to have an exploratory, no-obligation conversation with you. Feel free to give us a call at OpenCircle, 203-985-0448.

Talking About Finances: Women Should Initiate

March 7th, 2016 Posted by Estate Planning, Family Finances, Investor Behavior, Marriage and Finances 0 thoughts on “Talking About Finances: Women Should Initiate”

Studies of people’s financial behavior show that initiating important financial discussions is key to achieving and securing financial well-being, especially for women. Whether talking with their spouses or partners, or with their parents or children, women who take the lead in talking about sensitive financial issues are better prepared to deal with the hurdles that may occur on the pathway of life. They are also less afraid of what the future might bring.

Discussions with Spouse or Partner

Surveys reveal that a majority of women are willing to talk with their spouses or partners about issues related to aging, but many do not start the conversation. When it comes to discussing, researching, and selecting financial solutions for dealing with the possibilities of failing health or complications around mortality, less than half of women are “proactive; they are willing to be involved but unlikely to initiate the discussion. Some women, even if they know it would be prudent, will only talk about these subjects if actually pressured to do so.

Discussions with Older Parents

Many women are or will be assisting aging parents. Yet an overwhelming percentage of women have not talked in-depth with their parents about their financial needs and arrangements as they grow older. Many say that they have not done so because their parents are sensitive about financial issues. And some women truly feel that their parents’ financial affairs are” none of their business. Chances are strong, however, that many women will eventually have to deal in some way with their parents’ business matters. The better prepared they are, the easier it will be.

Discussions with Grown Children

Women also seem reluctant to have substantive financial dialogue with their grown children. With regard to their later life needs, a small number of women may have explained provisions for their retirement income or long-term care to their children. A significant number of them, however, have not discussed their will or estate plans with their offspring. Experience demonstrates the wisdom of having these conversations sooner rather than later.

The fact is that money remains a difficult topic within many families. Oftentimes, individuals, and women in particular, will wait for someone else to launch the subject, all the while losing precious time for planning. In view of that, we at OpenCircle stress the importance of women taking the lead in initiating financial conversations with their loved ones. We can help. Give us a call at 203-985-0448.

Stuck in the Sandwich Generation?

February 26th, 2016 Posted by Budgeting, College Planning, Family Finances, Investor Behavior, Saving, Youth and Finances 0 thoughts on “Stuck in the Sandwich Generation?”

Families can be such a source of comfort and love that many children dream about having families of their own when they grow up. As we age, of course, we learn that the benefits of family life also come with responsibilities. And just as we start thinking our children will be leaving the nest soon and some of the demands on our time and resources may lighten, we realize that our parents may need us in new ways.

A large segment of our population now belongs to what is known as the Sandwich Generation. They may feel stuck in the middle, caring for dependent children and aging parents.  On top of all that, they also need to plan for their own retirement years and potential long-term care needs.

Many members of the so-called Sandwich Generation believe in higher education and want to provide that opportunity for their children.  Others are called upon to share financial resources with a divorcing adult child or help raise a grandchild.  Furthermore, as average life expectancy increases, their aging parents may live well into their 90’s and put additional strain on already limited resources of money and time.

There is a growing trend for the in-between generation to shoulder the financial burden for both the younger and older generations.  The unintended result may be, unfortunately, that the needs and wants of these parent-children suffer in the process.  It is hard to see a way out.

Perhaps it is not as hopeless as it seems. It can be possible to balance financial responsibilities across generations. There are ways that people can potentially help their children and their parents without sabotaging their own long-term financial security and quality of life.

While there is no magic formula, a well-thought-out approach can enhance communication, build financial strength, and nurture resourcefulness in all family members. Here are some specific ideas that can help:

Plan Ahead

If you plan ahead, you may be able to lighten the load. Expenses like college tuition for your children and long-term care for your parents can be overwhelming. With the guidance of a trusted financial advisor, you can research your options and make preparations well in advance of important life events.

Request and Welcome Participation

Include your family members in the planning and preparation for their future needs and wants.  Ask them to contribute what they can, and follow up to make sure they do.

Your children could assume responsibility for a portion of their higher education expenses. The older generation should think about their eventual needs – urge them to plan ahead both financially and emotionally for their later years and the possible side effects of aging.

Nurture and Reinforce Independence

In an effort to demonstrate your love, and perhaps because you find it easier in the moment, you may do too much for your children and for your parents. The more you do for others that they can do for themselves, the more you weaken their independence.  When you do too much for a loved one, you may be implying to them that they are less capable than they really are.  It is in your best interests and theirs to nurture a spirit of self-confidence and self-sufficiency in those you love. The result could be a better life for all of you.

[Photo credit: Flickr user Kevin Cramer]

Family Wealth Planning Conversations

February 22nd, 2016 Posted by Budgeting, College Planning, Estate Planning, Family Finances, Homes and Mortgages, Life Planning, Loans and Debt, Marriage and Finances, Retirement Planning, Saving 0 thoughts on “Family Wealth Planning Conversations”

What Are Family Wealth Planning Conversations (And Why Have Them)?

Whether gathering for annual reunions, sharing childhood memories, or simply being there for one another during difficult times, family traditions nourish our most satisfying relationships. An important tradition that we at OpenCircle foster with our clients focuses on family wealth planning. We facilitate conversations that engage every family member, each of them contributing their talents and interests to achieving their collective and personal lifetime goals.

That does not mean that everyone must participate equally. As we work with families, one individual often emerges as the spokesperson or steward for the group. That’s fine … if the role is based on a mutual and deliberately planned arrangement. If it is instead based on unspoken assumptions or force of habit, a family’s wealth planning may benefit from a fresh conversation.

Even if a family is in full agreement on who is best suited to champion its interests, there’s always life’s many “what ifs.” Are others in the family adequately prepared to assume the stewardship role when and if it is required of them? Might they have unexpressed questions or concerns that are best addressed well before that day may arrive? Carving out time to hold candid conversations is where it all begins.

How We Guide Our Clients in Family Conversations

To launch a family wealth planning conversation with a client, we invite them and their family to meet with us at their convenience. (A face-to-face meeting is optimal, but we can harness technology to hold a meeting online if necessary.) We guide them in exploring key considerations such as:

  • How would each of them define their roles in their family’s wealth planning?
  • Are all of them satisfied with their current roles?
  • Do all family members have the essential information, should they be required to increase their participation? (For example, do they know how to reach us?)
  • Are there other questions, suggestions or family wealth dynamics they would like to explore, either immediately or over time?
  • How can we best assist each of them in these and other areas?

We help families find broader and deeper perspective in this area of their lives. Even though specific family members may never have joined us in prior meetings, we encourage them to be included at this time. They may well discover insights about one another that could strengthen both their financial conversations as well as their overall family dynamics.

Regardless of who may be “in charge” of a family’s wealth, every individual is equally dependent on the outcome of the efforts. Enabling a forum for everyone’s voice to be heard is another way OpenCircle helps our clients achieve their greatest life goals, keeping their family’s wealth fresh and meaningful over time. If you would like more information, please give us a call at 203-985-0448.

[Photo credit: Flickr user Luke Lehrfeld]

The Realities of Being Wonder Woman

February 15th, 2016 Posted by Family Finances, Generational Financial Planning, Investor Behavior, Jobs, Careers and Benefits, Life Planning, Loans and Debt, Marriage and Finances, Retirement Planning, Saving 0 thoughts on “The Realities of Being Wonder Woman”

Wonder Woman is 75! No, that’s not her age in comic books, but it is how many years have passed since her character was created in 1941. Her “diamond” anniversary has sparked renewed interest in this unusual heroine and reminded many of us about her accomplishments. From the days of World War II through the present, she has confronted and beaten many of the challenges that real women face. She has served as a role model and a trendsetter; she has emulated and fostered that we-can-do-it attitude. She is also a reflection of the world around us.

We see regular reports about the progress women have made in recent times. They are better educated than ever before, with more women than men currently in college. There are more women than men in the workforce. Many more women are the primary breadwinners for their families than in the past. They are leaders in many professional fields and have made great strides in the business world.

With all this progress, however, women must still cope with difficult odds. While the gap is slowly narrowing, women continue to earn less money than men for equal work. While men are taking on more responsibilities in the home, women still shoulder more than their share of childcare and housework. They often end up with the bulk of caregiving for aging parents and other family members in need. And they continue to confront invisible barriers in the scientific and corporate worlds. The demands on their personal time can be overwhelming and the rewards of paid employment may be less than satisfying.

As if all this weren’t challenging enough, many women worry about having no one to care for them in their later years. They also worry about having a financial safety net that will withstand the unexpected. Concern about the cost of healthcare adds to overall anxiety levels.

Many women know that they need to do something about financial planning. They may feel, however, that they do not have the time to deal with it, adding to the emotional stress of their daily lives. They may believe that they should find professional advice, but may not know where to turn. While women as a group are becoming increasingly educated and informed about financial matters, they may not feel comfortable asking for help. At times like this, they do not feel very much like Wonder Woman.

The demands of 21st century life do not show any signs of diminishing. And as women are controlling more and more of the world’s personal wealth, the need for each of them to create and implement a solid plan for financial management is growing stronger. They need to find a way to do it that helps relieve stress, rather than adding to it.

At OpenCircle Wealth Partners, we can help. We have years of experience assisting women with the particular issues they face. We take great satisfaction in helping them find their way through the financial jungle to a place where they feel more in charge of their lives – to a place where they feel more like the Wonder Women they really are. Please give us a call at 203-985-0448 for a free, no-obligation, consultation. We look forward to hearing from you.

[Photo Credit: Paolo Rivera]

Making Sense of “0%” Credit Card Offers

December 17th, 2015 Posted by Budgeting, Economics, Family Finances, Loans and Debt, Saving 0 thoughts on “Making Sense of “0%” Credit Card Offers”

Are you unhappy with your credit cards? Does the “grass look greener” at other credit card companies? Are you maxed out on one or more credit cards and paying too much interest? Are you concerned about higher interest rates due to the rate increase that the Federal Reserve put into effect on December 16th? Whatever your motivation, you may be thinking about applying for a new “0%” card.

As we near the end of 2015, a number of credit card companies are still offering new customers 0% APR on purchases through 2016 and even into 2017. Many of them encourage applicants to transfer balances from their existing cards by extending the 0% offer to these transfers. This could look like the best of both worlds – wipe the slate clean on your old card and make a fresh start. After all, who can pass up an interest-free loan?

The beneficial features of these credit card offers are quite clear up front. The promotional material is designed to encourage your signing up, so the “perks” are highlighted. But as the proverb says, if it looks too good to be true, it probably is. It is essential to read the fine print. Here are some potential hazards to watch for:

  1. Annual fees

Some cards don’t have an annual fee, but many do. The cards that do have annual fees may waive them in the first year. Be sure you are aware of what the fee is or will be in the future.

  1. Other costs

There are lots of other charges that credit card companies may add on. These can include fees for late or returned (bounced) payment, which can be as high as $38 for each infraction. There may be a surcharge on foreign transactions. The interest rate on cash advances may be higher than on purchases. You could incur a fee for going over your approved credit limit. If you carry any balance at all, after the initial period, you may be charged a minimum interest fee. Make sure you know up front.

  1. Limitations

As stated above, the 0% rate may be applied to new purchases and balance transfers or only to one of those. The interest-free time period may be as long as 18 months or as short as 9 months. Even with a 0% offer on balance transfers, there may still be a transfer fee which could negate your potential savings. If you change card companies, you want it to be worth your while.

  1. Rewards programs

It is common for credit cards to offer rewards to their customers, in return for purchases on their cards. It is important to know that these cards may charge a higher interest rate in order to underwrite the rewards program. Some companies require a minimum spending amount before you are eligible for your earnings. Other companies may put a cap on your earnings. If the specifics of the program are not clear, insist on clarification.

Variable APR (Annual Percentage Rate)

The APR that a card company charges may be variable. Once the 0% period ends, you could be charged interest amounts that vary over time, with some APRs currently as high as 22.99% or more. Be advised that the rate on regular purchases could be different from the rate on balance transfers. And a late payment could cause your APR to rise, perhaps to as high as 29.99% or more.

  1. Fraud

When you sign up for a new card, make sure YOU are the initiator. Never accept a credit card offer over the phone unless YOU made the call. And never click on a link inside an email – if you apply online, do it through the company’s official and secure website.

A word to the wise:

Whatever credit cards you have, do your best to avoid carrying a balance. If you have an unpaid balance, chip away at it each month, because the interest you are paying is a negative investment. In other words, if you pay down your balance each month, the interest you save is money in your pocket.

[Photo credit: Flickr user Mighty Travels]

The Why and How of Fixed Income

December 15th, 2015 Posted by Economics, Family Finances, Investment Vehicles, Investor Behavior, Saving, Stock Options 0 thoughts on “The Why and How of Fixed Income”

Fixed Income. You read and hear about it in the financial media. You’ve no doubt heard that having some is a good idea, and you may actually have some fixed income holdings. But perhaps you don’t feel as though you have a good grasp of the actual role of fixed income in a balanced investment portfolio. Whether as a reminder or as a learning process, it never hurts to explore the subject in more depth.

First, let’s set the context by reviewing the basic categories of investments:

Stocks – Stocks are the most effective tool for those seeking to accumulate new wealth over time. But along with higher expected returns, they also expose investors to more volatility as well as increased uncertainty about ultimately achieving their goals, due to market fluctuations and risk potential.

Bonds – Bonds are a good tool for dampening volatility and serving as a safety net for when market risks are realized. They can also contribute modestly to a portfolio’s overall expected returns, but we don’t consider this to be their primary role.

Cash – In the face of inflation, cash and cash equivalents are expected to actually lose buying power over time, but they are good to have on hand for near-term spending needs.

Here’s another way of looking at it:

 Expected Long-Term Returns  Highest Purpose
 Stocks (Equity)  Higher Building wealth
 Bonds (Fixed Income)  Lower Preserving wealth
 Cash  Negative (after inflation) Spending wealth

By keeping your attention on these basic principles of stock/bond investing, it becomes easier to recognize that, even when your bond holdings are plodding along compared to the rest of your portfolio, the more important consideration is whether they are fulfilling their highest purpose in your total wealth management.

Bonds Are Safer, But They’re Not Entirely Safe

It may help to understand that bonds, compared to stocks, have historically exhibited lower volatility and market risks, along with commensurate lower returns. But they do exhibit some volatility and some market risk. Because bonds represent a loan rather than an ownership stake, they are subject to two types of risk that don’t apply to stocks:

  • Term premium – Bonds with distant maturities or due dates are riskier, so they have historically returned more than bonds that come due quickly.
  • Credit premium – Bonds with lower credit ratings, such as “junk” bonds, are also riskier, and they have returned more than bonds with higher credit ratings, such as government bonds.

When reading bond market headlines about interest rates, yield curves, credit ratings, etc., these are the two risks and commensurate-return expectations that rise and fall along with the news. But as alarming or exciting as bond market news may become, compared to stocks, the levels of volatility and degrees of risk need not – and really should not – be as extreme as what we must tolerate with equity/stock investing in pursuit of higher expected returns.

The decisions you make about the risks inherent to your bond holdings should be managed according to their distinct role in your portfolio, as we will explore next.

Act On What You Can Control

There are some proactive steps that you, as a long-term investor, can take to appropriately position fixed income investing to withstand varied market conditions.

Are your fixed income holdings the right kind, structured according to your goals?

Just as there are various kinds of stocks, there are various kinds of bonds, with different levels of risk and expected return. Because the main goal for fixed income is to preserve wealth rather than stretch for significant additional yield, we typically recommend turning to high-quality, short-to-medium-term bonds that appropriately manage the term and credit risks described above.

Are you keeping an eye on the costs, including taxes?

One of the most effective actions you can take across all your investments is to manage the costs involved. When investing in bond funds, this means keeping a sharp eye on the expense ratios and seeking relatively low-cost solutions. For individual bonds, it is important to be aware of opaque and potentially onerous “markup” and “markdown” costs. While these costs do not typically show up in the trade report, they are very real, and can detract significantly from your end returns. In choosing an appropriate fixed-income vehicle, it is also important to consider your tax bracket, to ensure that you get the best after-tax returns.

Are your solutions the right ones for the job?

Whether turning to individual bonds, bond funds or similarly structured solutions such as Certificates of Deposit (CDs), your fixed income portfolio should strike a harmonious balance between necessary risks and desired returns – within the context of your own plans and according to the distinct role that fixed income plays within those plans.

To achieve this delicate balance, it can make good sense to seek the assistance of an objective adviser to help you weigh your options, determine a sensible course for your needs, and implement that course efficiently and cost effectively. Your advisor also can help you revisit your plans whenever the markets or your circumstances may cause you to question your resolve. Should you stay the course? Are updates warranted? It can help to have an experienced ally to advise and inform you before making your next moves.

[Photo credit: Flickr user Roger]

Five Myths About Baby Boomers

December 8th, 2015 Posted by Family Finances, Generational Financial Planning, Investor Behavior 0 thoughts on “Five Myths About Baby Boomers”

Many of our clients at OpenCircle are members of the “baby boomer” generation, so it was with great interest that we read a recent opinion piece in The Washington Post. Entitled “Five Myths About Baby Boomers,” the post was written by Sally Abrahms, a nationally recognized writer on baby boomers. As a service to our readers, we are sharing a condensed version here.

There are 75.4 million baby boomers in the United States, people from 51 to 69 years old. They are a far more diverse demographic than any of their stereotypes convey. It’s time to debunk some generalizations.

  1. Boomers are wealthy.

Many empty nesters are snapping up second homes or moving into bigger quarters, seeking more space for friends and relatives to visit.

But many boomers couldn’t be further from living that dream. While some benefit from multiple income streams, members of this sandwich generation often are saddled with their children’s college tuition payments and health expenses for their aging parents. Some have to leave their jobs to be full-time caregivers.

On top of that, there’s a mounting number of “gray divorce” couples who, in their 50s and 60s, have to divide assets. And given boomers’ longer life expectancy, that translates into a lot more bills for many more years.

Savings aren’t helping them much. Working Americans age 60 or older have median savings of just $50,000, about $250,000 short of their goal. Furthermore, about half of retirees leave the workforce earlier than expected, often because of health problems or an employer’s decision.

For many boomers, their financial situation is more precarious than others think, and they have a palpable fear that they will outlive their money.

  1. Boomers are healthier than their parents.

Boomers have the longest life expectancy in history. They have access to new screening tests and greater awareness about health issues. They track their fitness and count their calories.

But research shows that boomers are in worse health than their parents at the same age. They have more disabilities and higher rates of chronic diseases. They are more likely to be obese, exercise less and have higher rates of hypertension and high cholesterol.

  1. Boomers are selfish.

Detractors complain that boomers stay too long at their jobs and in their homes, not making room for the next generation, spending their children’s inheritances and running up debt.

But boomers have been far more generous than they’re given credit for. The generation is poised to lead the largest wealth transfer in US history. And over the next 20 years, retirees will make charitable donations of money and time worth an estimated $8 trillion.

The generation has also solidified the concept of the “encore career,” parlaying their experience and skills into volunteer roles or paid “second act” jobs that have a positive social impact.

  1. Boomers are technology-challenged.

The fact is that boomers have integrated digital technology into almost every facet of their lives – from banking and shopping to following news and watching videos. A large majority of them own a cellphone and a desktop computer.

They are also not media-shy. Users over age 55 are Facebook’s fastest-growing segment. And the 50-plus set make up 20 percent of all online daters.

  1. Boomers don’t have sex.

Surveys show that people in this generation don’t let their love lives die. The downside is that the rate of sexually transmitted diseases in the 50+ age group is increasing, according to the Centers for Disease Control and Prevention.

At OpenCircle, we do not draw conclusions about our clients based on age, gender or any other factor. We treat each client on an individual and personalized basis. You should expect no less from your investment advisor or wealth manager.

[Photo credit: Flickr user Homini]

Surviving Divorce Without Going Broke

September 10th, 2015 Posted by Budgeting, Family Finances, Homes and Mortgages, Jobs, Careers and Benefits, Marriage and Finances 0 thoughts on “Surviving Divorce Without Going Broke”

Many of my clients are happily single or married, but a good number of them are not so fortunate. It’s a fact of life in today’s world that many people are divorced or wish they were. Making the decision to end a marriage is never easy. When you add the issues around money, it is even more difficult. And the emotional stress can seriously cloud your thinking.

If you are considering divorce, you should try to understand what it will cost you, not just emotionally, but financially. If you are experienced in money matters, you may have a good sense of how to proceed. On the other hand, you may not have any financial background and do not even know where to begin. The best way to start is with some questions.

Here are some of the financial questions to think about before you make the final decision to file for divorce:

  • Do I have an independent source of income?
  • Do I have assets of my own that I need to protect before I file for divorce?
  • Will I need to request/provide alimony or child support?
  • Do I have a good sense of what my spouse may request?
  • Do my spouse and I have assets that are shared jointly?
  • Can we split the assets as they are, or do we need to sell them first?
  • Will there be expenses or other consequences as a result of splitting our assets?
  • Can I afford a divorce lawyer?
  • Should I consult a financial advisor?

Even if you think you have a good grasp of the issues involved with divorce, things can get fairly complicated, and some things can take you by surprise. You might be able to find answers by doing research on your own, or it may seem overwhelming. This could be the most important time in your life to turn to a financial advisor for advice.

If you are already in the middle of a divorce, and do not have answers to the important questions, it is not necessarily too late.  Nothing is final until you sign your settlement in court. And even if you have answers, new questions will very likely come to the surface.  Keep your head on your shoulders as best you can, and try to avoid making decisions based on your feelings. If necessary, ask someone you trust to help you make decisions. You do not need to “cast your fate to the wind” and give up.

What if you are already divorced? Perhaps your financial house is not in order, or maybe the picture is so bleak you are not sure how you are going to make ends meet. Do not despair. There is no time like the present to assess your situation and create a plan for moving forward. You may have to downsize or tighten your belt until you can get your head above water and start rebuilding your life. You may need a plan for your retirement that takes into account that you will be on your own. Whatever your challenges, there is a rational way to handle them. You may need to live your life one day at a time, but how you deal with your money should be part of a long term vision.