Divorce can take a toll on you in a variety of ways, but few are as potentially devastating as how it affects your finances. It can have an especially negative impact on women, as MarketWatch reports that most experience a 30% drop in their living standards after divorce.
If you are a woman currently experiencing divorce, there are several ways you can protect your assets and ensure a healthy financial future.
Review your cash assets
Divorce often changes your standard of living, so it can be important to understand what assets you own individually and which you can liquidate. Not only are there divorce costs to consider but the future as well, where you will likely have to support yourself and any children to supplement child support and alimony payments. There are several assets you may consider for liquidation, including:
As you liquidate these or other items, you may want to do so as quickly as possible, as they may lose value as time passes.
Modify life insurance policies
Because life insurance policies carry a value that could protect you in the future, you may want to review any existing policies and modify them as necessary. For example, you can ask that the premium payments are transferred to your ex-spouse and that the current value still meets your financial needs for the future. If that value now falls short, you may have the option to modify it with the help of the insurance company.
Understanding the long-term consequences of any financial decision you make during a divorce can help you protect your interests in the future. Reviewing tax costs and the value of your own earning power may help you accomplish this and nurture your financial independence.