You spend your entire life planning for the future. You look forward to your retirement and the freedom that it will bring. But what happens if you find yourself in the middle of a divorce? Would you know how to maneuver your finances during such a difficult and emotional time? Join us in conversation with financial expert Pam Krueger who will share three fatal financial errors that many women make during a divorce. Enjoy the show!
Investor, financial expert, author, television co-host and business owner Pam Krueger brings invaluable advice to the Sixty & Me community. She knows that financial security is a high priority for women at any age, but that women in their 50s and 60s can often be uniquely challenged by circumstances beyond their control.
One challenge that many women encounter is divorce.
According to Pam’s research, the divorce rate for women over 50 has doubled since the 1990s and the rate for women over 65 has tripled. With more and more women facing divorce, it’s important that we understand our financial rights and responsibilities. Pam says there are three fatal financial errors that many women make during this emotional and difficult time.
Put your divorce paperwork away and forget about it.
This is a horrible mistake that many women make simply because they just don’t want to think about it. While “out of sight, out of mind” may help your heart heal, it won’t help you financially. In fact, it could cost you dearly.
Your divorce papers outline the rest of your life. Whether you go through it yourself or with the trusted council of an attorney, it is crucial to know what your responsibilities and rights are. If you have to take out a yellow highlighter to draw attention to specific dates, make sure you’ve done what is necessary to keep yourself aware and prepared to take on everything you agreed to in your divorce settlement.
It’s ok to keep those joint accounts with your ex-husband open because you’re on good terms.
This kind of thinking can literally cost you your entire life savings. It’s wonderful if you and your ex are being congenial but that does not mean that you always will be. If either one of you remarries, a 3rd person will have access to your funds and this is just not a good idea.
Every checking account, savings account, and credit card that has both of your names on it needs to be closed. Your attorney is not going to do this for you so it’s important that you are diligent to make these changes, yourself.
I can trust others to make sure all retirement funds, IRAs, 401Ks, 403Bs, pension plans, and life insurance policies are divided appropriately.
This is a very expensive mistake that many women have made. It is up to you to follow through and insist that all appropriate changes and divisions are made. You must also make sure that your beneficiary is changed on all legal documents so that your children, favorite niece, or best friend inherits your assets and not your ex-husband if something should happen to you.
The Qualified Domestic Relations Order (or QDRO) is a court plan that details how retirement funds will be divided and paid out after a divorce. While the court makes these judgments, they do not initiate those processes. That is your responsibility. This means that you may have to follow up with attorneys, employers, and possibly your ex.
Failure to ensure that the QDRO is properly written up, in place, and executed is the single most expensive mistake divorcing women make, according to Pam.
If you’ve gone through a divorce, have you made or avoided any of these mistakes? Do you have any other financial advice that you would share with other women headed for divorce? Please join in the conversation below!