Ep 30: Financial Decisions During Divorce

Retirement Coach's Corner

Going through a divorce at any age is difficult. If you are near retirement or in retirement, there are some additional financial complications you’ll want to consider amidst the divorce.

For starters, many women will choose to keep the house. Their home may feel more sentimental or an area of comfort. If that’s your choice, just make sure you know the ramifications of that to make sure it’s a fair agreement. A house won’t provide an income, and instead will still have costs associated with it, even if it is paid off. Sometimes a fresh start with a new place to live can be easier.

During the divorce, you will likely split up some of your retirement accounts. Make sure to think through what the tax implications and rules are of each account. Think about five years from now and how you can best position yourself for that time. Know what you actually have left after taxes are taken out. If you split a retirement account immediately following a divorce, determine whether you should roll it over directly or if it would be better to take some money out when you can do so without penalty.

Divorce is an emotional time. Anytime that emotions enter into investing, it’s usually not a good thing. Contact an advisor to help you navigate these financial decisions from a wise and logical standpoint instead of making any rash decisions.

What we discuss in this episode:

1:25 - Divorce: who gets the house?

6:35 - What are the tax implications of splitting up retirement accounts?

10:22 - Should you roll over a split retirement account directly into an IRA after the divorce?

12:49 - Be care that you don’t let emotions cloud your decisions.

Get additional financial resources here: https://mercurioadvisors.com/