Does your divorce team include a Financial Adviser?
Nobody plans for their marriage to end. However, with one-third of all marriages ending in divorce, there is a large possibility that you know someone who is already divorced or getting divorced. Generally, when a marriage ends the first professional you think of is a family lawyer, followed by an accountant.
While these people are a vital part of the team, when it comes to working through what financial assets will help you in the long term to rebuild your wealth, only a financial adviser can help.
The Financial Facts
The value of assets owned by a divorced man compared to that of a married man of the same age and background is 67% less. For a divorced woman, their financial assets are 90% worse than that of similar married women.
From an income point of view, men’s income generally will stay the same after they’re divorced. Women in the same position return to the workforce with a 14% proportional increase, however, their income is 10% lower than that of a married woman in the workforce.
Even super balances are lower:
- With a divorced male having 28% less and a divorced woman.
- Having 75% less super than their respective counterparts.
These figures follow through into retirement without much advancement.
Dually the overall financial shock of divorce hits both sexes hard in all aspects of their financial lives, from homeownership to retirement – nothing is left unturned.
How can a Financial Adviser help?
Considering the severity of the financial blow divorced brings, having a financial adviser on your team should be a no brainer. A great financial adviser will take the emotions out of your assets and explain to you what particular assets would be of greatest benefit to you in the long run…
They will be able to map out what effects taking the house over and more super or investment assets will have on your new immediate future. They will be able to strategically work out how you are going to rebuild your new future, and what you need to do to achieve the outcome you want.
Working with a financial adviser will allow you to reflect on what is important to you and your family, set goals, and decide what you need to do to get the outcome you want.
It might even mean that you could be 20% better off. Studies have shown that it takes 5 years for a family to start recovering financially post-divorce. Whereas if you seek advice this, can be reduced by 1 year or 20%.
What is evident is that muddling through a divorce alone will cause enormous financial setbacks. But by seeking out a professional to help you, will ensure your outcome will be better a better one.
Katie McDonald provides personal strategic advice to executive families, whose lives are busy juggling family, work, mortgages and holidays. With over 15 years educating women in financial literacy Katie also enjoys improving the financial outcome and security for women.