231 National Financial Literacy Month - Day 24 - Impact of Financial Literacy and Divorce

People do not talk about divorce they either keep it quiet or close hold as they go through this emotional ordeal. It is important to understand the divorce rate for Americans over the age of 50 has doubled since 1990, an increasing number of divorced people nearing retirement age may find themselves scrambling to solidify their finances as they approach their golden years.

Three out of four older divorced people need a better understanding of how to manage their personal finances. While men and women are equally as likely to break good spending habits after divorce, women are more likely than men to take steps to regain their financial health.

That's not all, financial planners report their female clients are twice as likely to seek out financial advice after a divorce, find a job, and increase their savings toward retirement. A lack of financial understanding that becomes evident during a divorce illustrates the importance of good financial practices when couples are married. Financial planners participating in the survey said the following steps would have helped their clients who are near retirement age be better prepared for divorce:

• Understanding how to manage personal finances (76%).
• Understanding the long-term financial planning consequences of a divorce settlement (73%).
• Understanding the tax implications of a divorce settlement (57%).
• Updating wills or trusts (51%).
• Increasing saving for retirement (51%).

Just over one-third (36%) of planners said establishing a prenuptial agreement would have better prepared their clients financially for divorce. There are three components to a divorce—legal, financial, and emotional. The legal aspects of a divorce are complicated, and the emotional upheaval is huge. The financial aspect is challenging because at least one partner may not have a good understanding of the family finances, including retirement savings.

Learn about Paul Lawrence Vann's digital Financial Fitness course, it is being offered at a 50% discount throughout the month of April, National Financial Literacy Month, here is the link:  https://bit.ly/3dbperG