Navigating the January Divorce Rush: Financial Insights Every Woman Should Know

Donna Cates, CDFA®, CRPC®

As the calendar turns its pages from December to January, it marks not just the beginning of a new year but also a time that has earned the somewhat ominous title of "Divorce Month." Statistics show that January sees a surge in divorce filings, as couples reevaluate their lives and decide to part ways. In anticipation of this annual trend, this article aims to empower women with crucial insights about divorce and finances, ensuring they approach the process with knowledge and confidence.

The January Divorce Phenomenon: January often witnesses a spike in divorce filings, and experts attribute this surge to a variety of factors. The holiday season, with its focus on family and togetherness, may prompt couples to delay their decision until after the festivities. Additionally, the start of a new year can inspire resolutions for change, leading some individuals to take the difficult step of ending their marriages.

Financial Awareness for Women: For women contemplating divorce or already in the process, understanding the financial implications is paramount. Here are key insights to consider:

1. Know Your Financial Situation:

Before initiating divorce proceedings, gather comprehensive information about your financial situation. This includes assets, debts, income, and expenses. Understanding your financial standing provides a solid foundation for negotiations.

2. Protect Your Credit:

Joint financial accounts can impact your credit score. It's crucial to monitor joint accounts and, if necessary, close or freeze them to prevent any negative impact on your credit during and after the divorce.

3. Alimony and Child Support:

Be aware of your rights and entitlements when it comes to alimony and child support. Understanding the factors that influence these payments can help you negotiate a fair arrangement.

4. Retirement Accounts:

Divorce can impact retirement savings. Women should familiarize themselves with the rules governing the division of retirement accounts and consider consulting a financial advisor to ensure a smooth process.

5. Tax Implications:

Divorce often brings about changes in tax status. Be prepared for potential adjustments in your tax filing, including considerations for claiming dependents and addressing any tax liabilities.

6. Legal Assistance:

Seek the guidance of a qualified family law attorney who specializes in divorce cases. Legal professionals can provide invaluable advice on your rights, responsibilities, and the best strategies for a fair settlement.

7. Emotional and Financial Support:

Divorce is emotionally challenging, and having a support system is crucial. Surround yourself with friends, family, or a therapist who can provide emotional support. Additionally, consider consulting a financial advisor to help you navigate the complexities of post-divorce financial planning.

As the new year approaches and the "Divorce Month" phenomenon looms, women contemplating or going through a divorce should arm themselves with knowledge. Understanding the financial intricacies of divorce empowers women to make informed decisions, ensuring a smoother transition into the next chapter of their lives. Remember, seeking professional advice and emotional support are crucial steps towards a more secure and resilient future. I’m happy to help. Consider attending my Second Saturday: What Women Need to Know About Divorce Workshop. Register here.

Investment advice and financial planning services are provided by Money Matters Wealth Solutions, dba Women’s Wealth Boutique, an investment adviser registered with the States of New Jersey, Alabama, Ohio, Colorado, Indiana, South Carolina, Virginia, and Michigan.

This content was generated with AI assistance. While we strive for accuracy, AI may not capture all current laws and market conditions. This information is for informational purposes only and should not be considered personalized financial advice. Always consult a licensed financial advisor for decisions tailored to your unique situation and goals. AI is used to enhance insights, not replace professional guidance.