Financial stability is a top concern among women who divorce. Yet a new study finds that over 95% of women do not use a financial advisor when going through a divorce despite having financial goals they want to achieve. In my position on the board of directors of the Association of Divorce Financial Planners, I see firsthand the financial consequences a divorce can bring. With the effects lasting years – even decades – why are women not seeking financial advice from an expert?
The biggest problem is a lack of awareness. Most women don’t know how a financial advisor can benefit them early on in the divorce process. Only 5% of women in a recent survey knew about using a financial advisor as part of their divorce team.
However, among the financial revelations from divorced women, a new study reveals that 61% of women said that they wish they would have known to use one. They believe that working with a Certified Divorce Financial Analyst (CDFA) would have been valuable and important to them and their attorneys.
How Financial Advisors Can Help During Divorce
A financial advisor can help you think through your lifestyle to gain a better understanding of your expenses both before and after a divorce. This is especially important for women who haven’t been involved in paying the bills, managing investments, buying insurance, or budgeting.
Financial advisors can also help you uncover critical financial assets that might not be on your radar. These hidden gems are crucial for making sure you get your fair share in a divorce. A few big-ticket items you may not have thought about include the following:
· Engagement and wedding rings
· Fine jewelry
· Heirlooms and antiques
· Bank and retirement accounts
· College savings accounts
Hidden Gems to Watch Out For
The marital home is an important consideration. Not only is there often valuable equity in a house, but you and your children, if you have any, will need a place to live after the divorce. Women with children are more likely to want to stay in the home but doing so might not be possible for financial reasons. If you can’t qualify to refinance the mortgage in your name or can’t afford to buy out your spouse’s share of the equity, there may be no choice but to sell it. Online valuation tools such as Zillow and Realtor.com can give you an idea of what your home might be worth, but you should work with a professional real estate appraiser before making any decisions.
In most states, an engagement ring is not considered a marital asset because it is a gift that is received before the marriage. This means that women will keep their rings as separate property, even in divorce. An engagement ring is often very valuable (think of Mariah Carey’s $7 million ring) but is usually put aside post-divorce, unused, unworn, and forgotten. When it comes to an engagement ring, women don’t often consider it to be a financial asset, but it can hold high value, considering the average cost of an engagement ring in the United States is $5,900, with wedding bands averaging $1,100 for women and $510 for men. If you want to sell your rings, Worthy is a site dedicated to helping women sell jewelry. Even if you sell your rings for roughly half of their value, a $3,000, 20-year investment with a 7% annual return can grow to nearly $12,000.
Heirlooms and antiques that are passed down from generation to generation through family members can hold significant value but aren’t typically considered marital property. On the other hand, bank accounts, retirement savings, and college savings accounts can be substantial financial assets. During a marriage, one in five women admits to handing over control of money to their husbands, but they must play an active role in their finances after divorce. Many women struggle to maintain the same lifestyle they had during the marriage, and a financial advisor can help you see the future more clearly to guide you when separating monetary accounts and other assets.
Divorcing Women Have Financial Goals
When it comes to financial goals that women have for the future:
· 66% hope to pay off debt
· 41% want to save for a comfortable retirement
· 38% would like to have an emergency fund
· 27% aspire to purchase a new home
· 20% are striving to create new streams of income
· 19% are hoping to build their wealth through investments
While it’s clear women who divorce have financial goals, many don’t have a clear path on how to achieve them. Financial advisors can play a significant role when dividing marital assets during the divorce process. A CDFA® professional can put you in the best position possible to help you achieve your financial goals post-divorce.
With women living longer, having a financial advisor by their side during divorce is crucial for long-term financial planning. However, according to the Worthy survey 72% of women who are divorced did not consider saving for retirement a top priority. This makes working with a financial advisor even more crucial when facing a divorce. A financial professional can help you overcome emotional turmoil to bring you the financial stability you deserve after divorce.
This article originally appeared on Forbes.
