Adjusting To Life Financially After A Divorce
By Frederick J. Dawson, ChFC, CLU
There’s no doubt about it – going through a divorce can be an emotionally trying time. In addition to the emotional impact a divorce
can have, it’s important to be aware of how your financial position will be impacted.
Assess your current financial situation
Following a divorce, you’ll need to get a handle on your finances and assess your current financial situation, taking into account the likely loss of your former spouse’s income.
Establish a budget
A good place to start is to establish a budget that reflects your current monthly income and expenses. Include your regular salary and wages, and any monthly alimony and/or child support you may receive
Consider taking steps to try to protect your credit record and/or establish credit in your own name. You’re entitled to a free copy of your credit report once a year from each of the three major credit reporting agencies. You can go to www.annualcreditreport.com for more information.
Review your insurance needs Typically, insurance coverage for one or both spouses is negotiated as part of a divorce settlement.
Evaluate your health, disability and life insurance coverage. Finally, make sure that your property insurance coverage is updated.
Change your beneficiary designations After a divorce, you’ll likely want to change the beneficiary
designations on any life insurance policies, retirement accounts, and bank or credit union accounts. Keep in mind that a divorce settlement may require you to keep a former spouse as a beneficiary on a policy.
This is also a good time to review your will. Make sure that your former spouse isn’t still named as a personal representative, successor trustee, beneficiary, or holder of a power of attorney in any of your estate planning documents.
Consider tax implications You’ll also need to consider the tax implications of your divorce. If you are receiving alimony, it will be considered taxable income to you. Child support, on the other hand, will not be considered taxable income.
Consult a financial professional Although it can certainly be done on your own, you may want to consider consulting a financia professional to assist you in adjusting to your new financial life.
Some Content Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2014.
Fred Dawson, ChFC (Chartered Financial Consultant), CLU (Chartered Life Underwriter) has over 30 years of comprehensive wealth management experience. He is Executive Vice President of Bassett, Dawson & Foy, Inc. and a founding principal partner of the firm. Successful women are prominent among Fred’s diverse domestic and international client base of professionals, retirees, professional musicians and business owners. In 2008 Fred was cited by Delaware Today Magazine as one of Delaware’s Top Financial Advisors. Criteria are not necessarily based on client satisfaction or advisor performance. Fred received a State of Delaware Senate Tribute in 1999 for his “long and distinguished record of service to his community, his country, his state and his region.”
- Bassett, Dawson & Foy, Inc. is an Independent Registered Investment Advisory Firm with the State of DE.
- Securities Offered Through Raymond James Financial Services, Inc. Member FINRA/SIPC
- Any opinions are those of Fred Dawson and not necessarily those of RJFS or Raymond James.
Fred is frequently sought after as a public speaker on financial matters. If your group or organization would like to hear Fred speak merely contact his office at 302-999-9330.
For more information or to schedule a complimentary, no obligation initial consultation contact Fred’s office at 302-999-9330 or email@example.com.
Frederick J. Dawson, ChFC, CLU
Wealth Manager, Raymond James Financial Services, Inc.
Executive Vice President, Bassett, Dawson & Foy, Inc.
Bassett, Dawson & Foy, Inc.
E.A. Delle Donne Corporate Center
1011 Centre Road, Suite 110
Wilmington, DE 19805