Any wealth advisor who works with women in transition can tell you that those who are going through divorce have abundant questions. Unfortunately, emotional devastation and confusion typically coincide with the dissolution of marriage, so grappling with financial uncertainties can seem impossible amid the trauma. But facing these questions and coming up with viable answers is one of the most important things a woman can do to reclaim her life and define a path forward.
What kind of division of property should she request? What happens to debt that was incurred during the marriage? Who gets the house? What does she need to do about tax filing? Should she begin looking for work? These are just a few of the questions that can overwhelm a divorcée, especially if her soon-to-be-ex-spouse made most of their joint financial decisions. For this reason, one of the most important services that Mercer Advisors offers is experienced counseling and guidance for post-divorce financial strategy.
What is a financial strategy?
Whether it’s for negotiating the end of a marriage or planning for retirement, a financial strategy involves a specific approach and process. A wealth advisor serves as a financial architect, taking a holistic view of a client’s situation before creating a detailed plan and then working with the client on solutions to major challenges. The wealth advisor also oversees the process to ensure correct implementation of these collaborative solutions. The financial strategy process typically unfolds in three phases:
- Due diligence: The advisor consults with the client to gain a detailed understanding of needs, goals, and highest financial priorities.
- Strategy development: The wealth advisor creates and presents a plan involving choices and financial tools custom-designed for the client’s specific needs. These might include investment management, insurance solutions, retirement planning, or estate planning.
- Implementation: The strategy is set in motion through consultation among the advisor, the client, and other professionals.
Following through
Once the strategy is implemented, the wealth advisor will continue to coordinate closely with other professionals to monitor progress and identify emerging issues that may require plan updates or changes. At Mercer Advisors, your wealth advisor is in a distinct position to function as the “field captain” for your other professional contacts, making sure that the strategy unfolds in the best way for your needs. If you’re going through a divorce, this might include working closely with an attorney so that your financial interests are represented during estate division negotiations, coordinating with a tax advisor to effectively manage the transition from filing jointly as a married couple to filing a single return, meeting with an insurance representative to discuss the continuation or adaptation of appropriate coverages, or working with a business valuation consultant to protect your interests when a family business is being sold or divided. These activities can relieve significant stress, allowing you to focus on matters that no one else can handle, such as relationships with children or other family members, self-care, and similar important concerns.
Who’s on your team?
By now, it should be obvious that some of the most important choices for a woman during the crucible of divorce are her team members. Besides an attorney who can best represent her legal interests, she should also give careful thought to who can help guide her through new financial complexities. A fiduciary financial planner—someone who’s professionally obligated to always put a client’s interests first—can be a valuable partner and guide during difficult times.
Key attributes of a qualified advisor:
- Someone with whom you feel comfortable and who can provide empathy as well as expertise
- A credentialed professional who’s been in practice for a significant period of time
- A specialist with a strong network of professional contacts in areas that are most important to you, such as taxation, legal representation, and insurance
- Someone who is knowledgeable and experienced and can communicate complex financial subjects clearly and free of jargon
- Perhaps most important of all, someone who will listen carefully and commit to understanding your needs, whether spoken or unspoken
Anyone who has experienced the challenges of divorce can tell you that it’s easy to not recognize the significance of certain financial decisions that must be made. Every asset should be carefully analyzed for current and future ramifications. Tax implications of every decision should be well understood. Financial details should not get lost in the multitude of actions taken to arrive at a settlement.
The good news is that you don’t have to do this alone. A wealth advisor, attorney, CPA, and other professionals can help guide you through the important decisions so that you can arrive on the other side of a divorce settlement with a solid financial foundation for a new future.
Are you going through a divorce and looking for professional advice on how to protect your financial interests? Contact your wealth advisor to learn what they can do to help prepare you for the future. If you’re not already a Mercer Advisors client, let’s talk.
