Financial success following a divorce
As originally appeared in The Jerusalem Post on July 19, 2024.
“He taught me housekeeping; when I divorce I keep the house.” – Zsa Zsa Gabor
A few days ago, I was trying to organize my desk. I specifically said ‘organize’ and not ‘clean up’ because my desk is the definition of organized chaos. It’s not clean by any means, in fact, you may say that it’s a mess, but there is a method to the mess. I happened to find a pile of business cards. That already indicates the last time I tried to straighten up! Do people even use business cards today? I stumbled upon a card of a cab driver that wanted me to use him for ‘a special’ whenever I needed to go to the airport. I never used him, but I had written a few notes on the card, and I started thinking back and remembered the story.
A few years ago, I was in his taxi and as is usually my custom I started chatting with the driver. Our conversation was interrupted by a call from a female cousin of his that recently got divorced. As the call was on the loudspeaker and of course this being Israel, I heard everything. After he hung up, he started telling me how she was struggling to cope financially since the divorce, and that he was helping her out trying to get organized. I told him that I am a financial advisor and that unfortunately, I help advise divorcees to become financially independent. I gave him a few tips and after he thanked me and mentioned like 5 times that it was a miracle that I was in his cab at the same time his cousin called.
I have been counseling a recently divorced woman, to help get her back on firm ground financially. She was married right out of high school and never lived on her own. After some initial insecurity, she has become highly motivated to become financially independent for the first time. Part of what motivates her is to stick to her ex, as he made some cruel comments about her never being able to make it without him.
Becoming financially independent after years of relying on a spouse can be a major adjustment, and having the right legal guidance during the divorce can make the process less confusing. There are often important decisions involving finances, property, support, and other matters that can affect how secure someone feels once the marriage is over. It is understandable to want to move forward with confidence, especially after being told that you could never manage on your own.
Getting clear advice about your rights and having proper representation can help you make those decisions with a better understanding of what comes next, and Divorce Matters is the kind of divorce attorney firm people may turn to when they want experienced legal representation throughout this difficult transition. The goal is not simply to get through the divorce, but to come out of it in a position where rebuilding an independent life feels possible. For more information about navigating the legal and financial challenges of divorce, read more about the steps that can help you move forward with greater clarity and confidence.
Knowing what you are entitled to is only part of preparing for life after marriage, since there are also practical steps that need to be taken before the divorce can be finalized. Understanding how to file for divorce can help remove some of the uncertainty around paperwork, required documents, filing procedures, and the decisions that may need to be made along the way.
The process can feel particularly overwhelming when you are already dealing with financial changes and trying to establish a life on your own, which is why having a clear idea of what happens next can make things easier to manage. Lancaster Law Group handles divorce and family law matters, and seeking legal advice can help someone understand the filing requirements and how their individual circumstances may affect the process. Getting these details straight early on can prevent avoidable delays and give you a clearer picture of the steps involved, allowing you to focus not only on ending the marriage but also on building a more secure future afterward.
Here are some of the money tips that she is using to help get on solid financial footing. Before you send me the hate mail, these tips apply equally for men. It’s just that still while statistically divorce impacts both spouses, it’s more negatively impactful financially on women. If you are currently going through a divorce, family lawyers Melbourne can help you navigate the process and protect your interests. For those needing family advice, make sure to contact a family law professional for expert legal assistance. Get the top high asset divorce attorney on your side to ensure that your property, investments, and financial future are properly safeguarded throughout the proceedings. Additionally, local family law advocates California residents rely on can provide valuable guidance on issues such as child custody, support arrangements, and property division, helping families make informed decisions during challenging times.
Take Stock
The first thing a divorcee needs to do is get her hands around the budget. This is the first step towards financial empowerment. Many clients have told me that by doing this relatively simple exercise, they feel that they gained a level of financial control they never assumed they would have. Whether you kept a budget while married or not isn’t relevant. You are going to have a whole new set of expenses and will probably have different sources and levels of income than you had previously. Break your expenses down to those that are monthly and those that are annual, one-time expenses.
Once you have that organized, write down all of your various sources of income, salary, child support, bituach leumi…etc. What’s important in budgeting is to let your income drive your expenses. This means that once you know how much money enters your bank account each month, create a budget that limits your spending to the amount of income you have. While this seems basic, most individuals let their expenses drive the process, meaning that they spend money without discipline and hope that at the end of the month they don’t go into overdraft.
Understanding your budget can also play a major part in the asset division during your divorce proceedings. A well-known family law expert once told me that much aggravation and time would be saved if women knew how much money they needed to live off of. With this information, women can avoid spending years and thousands of dollars fighting for every last penny. If you know how much you need to live, you’ll know how much money to ask for.
Invest Lump Sums
As part of a divorce settlement, many women come into large lump sums of money and have no idea of what to do with it. It’s important that this money is used to help meet any financial goals that you may have. If after doing your budget you see that you will need more income to make ends meet, then you will want to make sure that your money is invested in a way that can maximize the amount of income produced, while preserving or even growing your portfolio.
Take Charge
As I have written previously, this new situation is actually therapeutic. According to Family Mediator Kathleen O’Connell Corcoran, Ph.D., “After divorce, women experience less stress and better adjustment in general than do men. The reasons for this are that (1) women are more likely to notice marital problems and to feel relief when such problems end, (2) women are more likely than men to rely on social support systems and help from others, and (3) women are more likely to experience an increase in self-esteem when they divorce and add new roles to their lives.”
Use this newfound independence and take control of your new financial reality. Speak with a financial advisor and create a plan that will enable you to get on with your life and be financially independent.
The information contained in this article reflects the opinion of the author and not necessarily the opinion of Portfolio Resources Group, Inc. or its affiliates.
Aaron Katsman is the author of Retirement GPS: How to Navigate Your Way to A Secure Financial Future with Global Investing (McGraw-Hill), and is a licensed financial professional both in the United States and Israel, and helps people who open investment accounts in the United States. Securities are offered through Portfolio Resources Group, Inc. (www.prginc.net). Member FINRA, SIPC, MSRB, SIFMA, FSI. For more information, call (02) 624-0995 visit www.aaronkatsman.com or email aaron@lighthousecapital.co.il.
