Divorcing Bombshells-Five Financial Surprises Women Often Encounter

Divorce is never easy, but one of the more challenging aspects can be the unexpected financial surprises that often come with a split. Let’s examine five financial bombshells women frequently encounter during and after divorce.

1. Piles of Debt

Many women are surprised to learn they are jointly responsible for all debt taken on during the marriage, including the mortgage, a home equity line of credit, auto loans, credit card debt incurred by both spouses, 401(k) loans, and student loans. They may also be surprised by the amount of debt their spouse has accumulated during the marriage without their knowledge. It’s imperative that women get the complete debt picture before divorce proceedings start. The responsibility for repaying debt should be part of the divorce negotiations since it can seriously impact her future financial situation.

2. You Can’t Stay in the House

Some women expect that they’ll continue to live in the marital home after divorce. What they don’t realize is they must buy their spouse’s half of the house at current market value and take on all of the home financing on their own. Most couples find they need to sell the marital home to pay off the mortgage, meaning both parties must find a new place to live.

3. Alimony and Child Support Aren’t Enough

Ready for a big surprise? Many women are not awarded alimony at all. Even if granted, they’ll likely find it isn’t enough to cover living expenses. Equally disappointing is the fact that child support payments rarely cover all child-rearing expenses. That’s why it’s never too soon to look carefully at post-divorce expenses. You’ll need to create a realistic budget to help you make serious financial decisions, such as moving to less expensive housing or finding a higher-paying job.

4. A Return to the Workforce

Most stay-at-home moms and wives realize a return to the workforce will be a necessity after a divorce, especially once they realize the realities of alimony and child support. What can be surprising, however, is how difficult and costly finding both a job and quality childcare can be. Starting early with the job search process can be beneficial.

5. The High Cost of Health Insurance

Divorce often means paying for your own health insurance. The price tag can surprise you if you’re accustomed to being part of your spouse’s employer-sponsored plan. The average cost of health insurance premiums continues to rise, so planning for this expense is a key part of preparing your budget.

Life after a divorce comes with a variety of challenges, many of which are financial. Call our office to schedule some time so we can help you better prepare for this new stage of your life. We’re here to help.

This material does not represent tax or legal advice; therefore, it is important to coordinate with your tax or legal advisor regarding your specific situation.

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