A divorce is a life-changing event. Accordingly, a divorce affects a person's emotional well-being and the process may feel stressful. Even when a person knows a divorce was inevitable and necessary, there still may be a feeling of loss; therefore there is a natural temporary mourning process. This makes even basic decisions feel difficult and therefore making major decisions at this time on your own can be dangerous. A divorce also completely affects one's financial situation. Planning for one's future becomes even more important because of the changes a divorce creates. Dealing with the emotional feeling associated with a failed marriage at the same time as having to rethink you financial future may be difficult and feel overwhelming.
For the above reason, it is critical to work with professionals to help you through every step of the process. First, it is imperative that you feel comfortable with your divorce attorney. He or she will provide you guidance through the divorce process. Some divorcing spouses even involve their financial planners during settlement negotiations before entering into a settlement agreement. Once the dissolution process is final you will have to deal with other professionals such as real estate agents and estate planning attorneys to revise your estate plan.
You should immediately inform your financial planner of your major life change once a divorce is final. Michelle Wright, a former financial advisor at industry juggernauts such as Prudential Securities, Smith Barney and Citi Group states, "It is critical that your financial advisor is always aware of your current and future needs as well as your changing and evolving needs." A true financial plan constantly grows and evolves. Wright adds, "We <Financial Advisors> need to know when our clients go through major life changes so we can adjust their financial plans appropriately."
If a supported spouse is dependent on a fixed amount of alimony / spousal support then they will need to set a smart budget, save and invest as much as possible and even consider protection via appropriate life insurance. If a settlement was reached and one spouse received a lump sum payment, the money must be invested wisely and responsibly. Moreover, paying off debts must be done strategically and in a savvy manner. Wright emphasized the need for a professional to help. She stated, "Never try to plan your own financial future during a time of change, stress or feeling of loss."
Wright, who is now a prominent real estate agent in the Greater Naples Florida area informs that the above principle should apply when addressing any asset, including buying or selling a new home. She informs that the smartest buyers and sellers take their emotion out of the equation and simply let their real estate agent do what they do best. Wright explains, "An effective realtor makes their clients feel comfortable and aware of the process and thus evokes their trust." If you do not get this from an agent it is time to move on to a new agent.
In addition, a recently divorced individual should revise their will and estate plan immediately. Jim Green of Claery & Green who has prepared hundreds of simple wills informs, "A life change such as a divorceabsolutely warrants a revised will and estate plan." He stresses the need to find an attorney you feel comfortable with to make sure the documents are done properly.
By Lance Claery, Attorney at Law