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Austin, TX 78759
Telephone: (512) 346-6444

Surviving After Divorce

“Surviving and Thriving after Divorce”

Dan Johnson, Certified Divorce Financial Analyst

March 2012

Divorces are often very emotional, stressful and expensive! Although the “costs” associated with divorce can be significant, these costs are often dwarfed by the financial calamities that often occur in the years following a divorce! While the primary focus during the divorce process is often obtaining the “best” possible settlement, significant financial mistakes and costly errors often occur AFTER the Decree of Divorce is signed! Too often, clients believe that signing the “Final Decree of Divorce” brings closure to their divorce ……and planning. Much like the mental health aspects of divorce (the recovery, healing and planning aspects of post divorce), avoiding the necessary post-divorce administrative and financial issues can result in severe consequences down the road.

Unfortunately, most people do not fully understand the financial intricacies of divorce or the post-divorce planning issues! Within five years following divorce, nearly 87% of divorced women incur significant (and often avoidable) financial hardships as a result of not addressing the necessary financial issues associated with asset management, budgeting, taxes, career and estate planning!

POST-DIVORCE administrative issues and planning to consider:

  1. Insuring Financial Interests – Child Support, Spousal Support, College Funding and Pension Risks! What happens to contractual and planned obligations upon your “ex’s” (or your) death? Are you prepared for the financial risks associated with divorce and death or disability?
  2. College Funding for Children – The question still remains after a divorce – how do you fund college costs for the future?
  3. Retirement Accounts and IRA Transfers – Are QDRO’s drafted properly? Have they been submitted to the court? Has the plan administrator processed the QDRO? Do you understand what to do with a “Distribution Packet”? Who do you call with administrative, processing and tax questions?
  4. Real Property – Are titling and deed issues addressed? Are you required to re-finance mortgages? What are the issues and implications of mortgages and divorce? Do you even qualify for re-financing and if so, what are the best financial options? Can you qualify for or afford a new house?
  5. Budgeting & Cash Flow Planning – Are you prepared to manage finances, income and expenses post-divorce?
  6. Estate Planning – Wills & related documents, trusts, updating beneficiary elections on life insurance policies, 401ks, IRAs, annuities and other contractual related accounts – Are you prepared and positioned to protect yourself, your family and your estate?