In my 36 years as a Private Wealth Counselor, I have seen many divorces. Make no mistake about it — divorce is heartbreaking. To make matters worse, you’re left to figure out how to salvage the economics of your new financial life after the divorce.
I have found that, for my clients, the best way to start is by taking one step at a time. Write down a list of the most important items and then commit to addressing them one by one.
The first thing you need to do is to take care of your body and pay attention to your own needs. Find someone to help you with meditation, yoga or work with a personal trainer at your local health club.
You will need to find a strong divorce lawyer. A good lawyer will help you understand what your rights are, along with your
responsibilities, throughout this process.
It’s important that your attorney is more of a teacher than a dictator. The goal is to legally close the relationship, then move on.
Financial worries can and will be some of your biggest stressors, so ask your existing trusted advisors (CPA, estate planning attorney), for several recommendations for a qualified financial advisory firm. It is important to ask if the firm has a special divorce planning group.
You should interview each financial advisor and ask for references you can call to confirm they have done a good job advising their existing divorced clients.
When working with a qualified financial advisor, the first step they will take is to take an inventory of the assets you have and help you to determine where you are now and how to generate income from your investments that can help sustain your lifestyle after the divorce. This could be a list of assets you own individually or jointly with your spouse and will include 401(k) plans, stock options, real estate holdings, private investments and deferred compensation plans.
Another reason to update your insurance policies, is to name a new beneficiary after your divorce. Post-divorce, your life insurance and disability payouts should go to loved ones who depend on your income, not your former spouse.
A financial advisor worth their weight will be sure you have at least a term life policy worth 10–12 times your annual income, to protect your loved ones should any- thing unexpected happen to you.
Like life insurance, your will or living trust document will need to be updated to benefit your kids and loved ones. You’ll need to update these documents, so your possessions and assets go to the right people and not your former spouse. It is best to wait until the divorce is final, so you know which assets to include into your new estate planning documents.
After the divorce is final, you will want to update your powers of attorney. You most likely will want to remove your former spouse from having the power of attorney to make your financial or medical decisions for you, should you become incapacitated due to an accident or injury.
With the assistance of a qualified financial advisor, you will be able to put yourself in a better position to live your best life and have peace of mind that your wealth plan reflects this life change. You don’t have to go it alone. Having the right advice along the way from a team that puts your interests first is key don’t settle for anything less.
KELLY TREVETHAN is a senior wealth advisor with Mariner Wealth Advisors. He is a 36-year veteran of the financial services industry and has helped many families navigate divorce.
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