Case Study 4



Assess finances, save for retirement and look for ways to increase income.

If you don’t know what to do, don’t do anything. This is the situation Becky is in after deciding to end her marriage of 12 years. During her marry, she relied on her husband to handle the finances and investments. Becky teaches middle school English and is getting custody of her two kids.

Becky knows that saving for retirement will be part of her budget and her post-divorce financial planning. She was awarded in the divorce decree the following assets and income:

  • The marital home and is to refinance the current loans into her name within 120 days of divorce being final. Her husband will receive his equity share upon refinance based on current divorce appraisal.
  • $500,000 of husband’s 401K via a QDRO.
  • Husband is to pay $1,200 monthly in Spousal Support for life.
  • Husband is to pay Child Support of $800 monthly until child turns 18 in 2 years.

Becky is unsure she will have enough to retire also wants to help her kids with the cost of college. She craved a plan that would allow her to retire confidently knowing she with have to make adjustments to her lifestyle. Becky had more questions than answers:

  • We I be expected to live on less than you anticipated?
  • Will I be forced to re-enter the workplace or work longer than expected?
  • Can I find a higher-paying job in my field?
  • Can I invest in myself by taking additional coursework or training, which will lead to a pay increase?
  • Will relocating to a new area offer greater employment opportunities?

The first step for Becky was to sit down with a financial planner who is also a Certified Divorce Financial Analyst. They come from a financial planning, accounting or legal background and goes through an intensive training program to become skilled in analyzing and providing expertise related to the financial issues of divorce.

The foundation of her post-divorce financial planning should be an honest, objective assessment of her finances. Taking stock of her current financial situation, making the inventory of her financial resources, and beginning to build her post-divorce budget.

Once her goals were clearly documented, a personalized retirement plan that aligned with her values and priorities could be created.

In collaboration with her tax and estate professionals, Becky was able to:

  • Establish a retirement timeline that included future financial changes (social security & Medicare).
  • Update the beneficiary designations on your retirement accounts and insurance policies, taking into account any agreements you made in the settlement. And you’ll want to make sure any non-retirement accounts are properly retitled.
  • Evaluate the beneficiaries you’ve designated in wills or retirement plans, as well as agent designations in medical directives or powers of attorney, to be sure your documents reflect your wishes.
  • Maximize the effectiveness of her savings during her remaining working years
  • Build an accurate post-divorce budget, including large one-time expenses

With a plan in place, Becky is able to bring back a sense of purpose and confidence to her remaining working years.

Have morie questions? Get your free planning assessment!

Step #1 in our Free Planning Assessment Process is a 20-minute phone consultation. Quickly schedule your appointment below:

Join my List and get you 10 Day CashFit Guide

Get Access to the 10-Day CashFit Challenge. This 10-Day money detox and money affirmations will help you answer the question "How am I doing?" and get you on your way to financial success.