Divorce can be extremely financially draining, especially for women. Aside from just paying for the legal fees associated with the divorce, women are typically the primary caregiver for the dependent children. Men also typically make more income than women, which makes it harder to afford the same lifestyle as before the divorce.
Planning for retirement can be the last thing on a woman’s mind as she is going through a divorce. When you are married, both you and your spouse are contributing. Once you are divorced, retirement savings have been divided up and you are left to your own income to contribute to your retirement savings. Keep reading for a few retirement tips for divorced women.
Negotiate for your current retirement savings
There are different stipulations in divorces that allow you to take a certain percentage of current retirement savings. No make sure you are not starting over again, be sure to make getting a portion of retirement savings a priority. Losing other joint assets may be worth gaining the retirement savings.
Become educated on personal finance and investing
Do research to find the best options for you. With your being closer to retirement with less money, you will want to find retirement savings accounts with higher yields so your money can build on itself quicker. You will also want to look at the different types of 401(K)s, IRAs, and mutual funds you qualify for.
Start as soon as possible
The quicker you start saving for retirement, the more money you can put away. While it is difficult to navigate your new financial well-being after a divorce, it is important to set yourself up for a good life in retirement.
Change your lifestyle
While you are already changing your lifestyle due to the change in income, make sure to budget for a specific amount of savings each month to put towards your retirement. By budgeting for this savings expense, you will not have to worry about finding extra money each month to contribute.
Prioritize your savings
Cutting down your spending to make sure you will be able to afford retiring on time. It is extremely important to save as much as possible since you will be on a fixed income in retirement. Getting rid of unnecessary expenses will also prepare you to spend money sparingly.
Contact a financial advisor
A financial advisor will be able to assess your portfolio and make recommendations on the best options for your financial well-being. An advisor will also be able to assist you in opening the best retirement accounts for people who are starting at a later age. Using an advisor can ease some of the stress of a divorce.
Life after divorce is scary with so many unknowns and changes. Make sure you are prioritizing your retirement savings to ensure you will be in a good position to retire when age 65 rolls around.
Sources:
https://blog.massmutual.com/post/women-divorce-tips
https://www.merrilledge.com/article/life-after-divorce-finances-women
https://www.advisorpedia.com/viewpoints/how-divorced-women-can-plan-for-retirement-and-succeed/