Getting divorced later in life can be more complicated than you may anticipate. Have you considered how your retirement plan will be impacted if you and your spouse separate?
Planning for this transition can be difficult and it can be helpful to use the resources that are available to you to make the process smoother.
Are you the financial or non-financial spouse?
Establishing if you’re the financial spouse or the non-financial spouse means knowing whether or not you need more help going through the financial items of divorce.
Oftentimes there is one spouse who works with the finances and one that is not so familiar with them. This becomes complicated when entering a divorce as one spouse is less financially literate than the other.
This is why it is important to work with a financial advisor throughout your divorce as one spouse can be left in the dark.
Divorce is hard enough, which is why we stress the importance of involving your financial advisors throughout your divorce process.
It is important to understand what the process of spousal payments looks like during a divorce.
These payments are also susceptible to various tax ramifications. These are the types of things that are important to talk about with your financial advisor when going through a divorce as many people are completely unaware of how to plan for this process.
Splitting Investments During Divorce
It can be helpful to put a game plan together, to make the process easier when it comes to splitting up your investments during a divorce. Start by running all the cash flow numbers, knowing the tax ramifications, knowing what the spousal payments look like, and knowing how everything gets split during the divorce.
It can be simple enough to divide up physical assets during a divorce, to an extent, but how exactly does that work for investments?Working together with a financial advisor can sort out all of these details, including the ones that become more difficult to divide between the spouses. Financial advisors can offer some great tools to use to evaluate the value of current stocks and investments to help keep the dividing of assets balanced and fair.
Creating a New Retirement Plan
If you are divorcing near your retirement age, you should consider modifying your retirement plan to reflect the spending habits and other things in your life.
Here are a few strategies we use:
- Organizing spousal payments in retirement and understanding their tax ramifications
- Negotiating shared assets with a divorce attorney
- Establishing how income will be taxed – single, joint, or head of household
- Working alongside a financial advisor through the entire process
10 Critical Steps to Take When the Agreement is in Place
Heller Wealth Management offers some great resources to help you organize the transition of divorce. Our website offers a full free checklist about some crucial steps to take once the divorce agreement is set in place and guides you through the steps to take following the settlement.
Click down below to find our website page on divorce:
10 Critical Steps to Take Once Your Divorce Agreement is in Place
In our client portal, we’re able to put everything together in one easy place and all your investments can be updated on a minute by minute basis.
You can get an aggregated view of your portal on your phone app or tablet. Any time you sign in you will be able to see your investments and net worth at any time.
To learn more about this topic listen to episode 102 of the Life Unlimited Podcast or contact us via our contact page.