Women, Divorce, and the Mistakes We Make When Breaking Up.
I’ve had the good fortune to work alongside a female investment manager, Sylvia G. She’s the money girl for women who don’t understand money but want more of it. : )) She’s a whiz kid with finances and especially helpful with women, wives, and moms going through a divorce. I liked her immediately, especially when she told me, “Cindy, I keep this one goal in mind when working with women through the breakup of their marriage; I want them to SWAN - Sleep Well At Night through the process.”
See why I like her?
Women (especially moms) tend to worry their way through significant changes. And where do these worries surface? At night, in bed, when tired mamas are trying to get a little shut-eye. Wouldn’t it be nice to SWAN instead of sweat all the details of this divorce? Ugh, DIVORCE. I know. The seven-letter, four-letter-word.
Divorce can feel crushing as it whips and turns our whole life upside down. When a marriage ends, there’s no shortage of hurt, pain, and problems to be addressed. Here’s a short list of topics women must tackle as they go through the one process they NEVER thought they would have to deal with.
Divorce affects all these areas: Kids, money, living arrangements, custody, spousal and child support, emotions like loneliness, anger, shame, fear and regret, daily schedules, moving to a new place, finances, sexuality, faith and spiritual practices, friendships, family ties, physical health, sleep patterns, legal battles and more. I said a short list…whew, that was a very long list of how divorce affects our lives. No one I know, myself included, has walked away from their divorce thinking, Well, that was easy. Often the opposite is true as husbands and wives typically crawl away from their marital collapse, feeling like a bomb has gone off in their lives.
To help, I want to share Sylvia’s list of common mistakes most women (and men) make regarding divorce, finances, and self-empowerment. My favorite “Mistake” is #4 - Most women do not understand their expenses.
The key phrase from that section is this: Women are typically not motivated as much by money but by having a clear understanding of what the money can do for them. (Let’s hear it for the girls who just want to be able to work a little less and be there more for their kids!). If this is you, read on as I share Sylvia’s ten most common mistakes women make in divorce.
10 Common Mistakes Women in Transition Make
by
Sylvia Guinan, MBA, CDFA®, First Vice President - Investments
1. They have not established a relationship with professional advisors – Financial Advisor, Attorney, Accountant
Taking a team approach to address all the puzzle pieces is essential, particularly when experiencing a life transition. Many moving parts need to be addressed; how you had things set up in the past will likely not be practical for where you are today. The investment planning process during divorce is fluid and dynamic. Needs evolve as one's life progresses, and it's essential that all service providers are aligned and in sync to respond with personalized solutions. Without professionals working on your behalf, strategies are often overlooked, and money (read: security) can be lost.
2. They don’t have a process that is integrated with their personal investment plan
An investment plan can become obsolete when a significant change occurs in a client's life. An asset and risk management process that is holistic and consistent complements a personalized investment plan while still allowing for mid-course corrections as life unfolds. A well-defined process outlines a clear strategy to help build, manage, preserve and transition wealth. These strategies are based on the four corners of Wealth Management – Financial strategies, Liability Management, Risk Management, and Legacy Planning.
3. They do not have their financial documents gathered in one place.
Having an organized and secure hub for easy access is critical, especially during the turbulence and loss of divorce. Establish a hub where you keep all financial-related information. That includes more than financial statements; it encompasses lending, insurance, giving, trust & estate, and educational planning paperwork. Clarity, confidence, and control are vital benefits of an investment process, especially if crucial elements are organized effectively. A Personal Financial Organizing System (PFO) and a safe at home are essential solutions for the organization, access, and safekeeping of important documents.
4. They do not have an understanding of their expenses.
A long view of sustainable success brings confidence when looking at your new future. Women are typically not motivated as much by the money but by having a clear understanding of what the money can do for them. It is essential to understand what it costs to maintain your lifestyle. Many times with transition comes change, and you need to understand how your spending choices will impact you in the future. Income and outflow must be clearly defined to help ensure the trajectory is accurate and aligned with investment goals. Mid-course corrections based on market fluctuations and other external issues are easier to make when the financial picture is all-encompassing.
5. Many women react to the transition – and do not plan for a positive outcome.
Getting out in front of the situation with a proactive and sequential approach will likely bring a much clearer and more successful path to your future. A transition like a divorce is not typically something we choose but often a situation that is dropped on us. It is important not to let the transition define you but instead take control through investment planning to decide where you want your future to go. Being clear about risk tolerance and expectations and staying focused on clearly set goals help you see past short-term obstacles and tune out the noise and distractions that can cause you to drift off track.
6. Some women do not have a sense of organization and prioritization when planning to move forward.
A holistic approach that provides a panoramic view of money's practical, strategic and emotional aspects can bring liberation and order to your life. FORM is an acronym that prompts you to consider Family issues, Occupational factors, Recreational pursuits, and Money Matters to ensure you are addressing all aspects of life. This helps ensure that you have gratitude for your accomplishments to this point in your life while still having ambitions for the future.
7. They resist change – are not able to think beyond today.
A transition like a divorce is challenging because it makes us aware that we are not always in control. It is easy to become caught up in the victim role. But it is all about perspective, and focusing on what you can control can help minimize your feelings of uncertainty. A personalized plan and a consistent process help you see past short-term obstacles and setbacks. Many fear change because of a lack of confidence and a lost sense of control. Lasting investment success is typically incremental but requires action.
8. Many women cannot articulate their fears and concerns.
It is crucial to articulate your fears as you implement a process that can put you on a clear path to your desired future. To feel empowered and confident, you must have a process to manage your risks and help build wealth (security). Having a sounding board (like a therapist or financial advisor) enables you to get your concerns out of your head and address them with a personalized approach. Fears seem more significant when they reside within one’s imagination and smaller when they are on the table and considered within a plan and process. Finding helpful support is so important. Be careful of helpers who keep you in a victim mindset and focus too much on how bad your ex is. This will not help you build your new life.
9. Procrastination & Avoidance
When divorcing partners procrastinate and avoid the reality of their situation, they can delay the inevitable process and ultimately prevent themselves from reaching their desired results. It is vital to stay focused on surrounding yourself with professionals that are a good fit for you. Provide them with the documentation they need to begin the process, and most importantly, set and keep appointments and be clear and candid about your goals and vision for your future. Do the work upfront and try not to look back too much; focus on the future. The most effective people take action, stay consistent, and face the future with anticipation rather than apprehension.
10. They keep their accomplishments a secret.
Once you successfully integrate into your new life after overcoming your transition, sharing your tools and strategies with others who may need help is important. A sense of purpose and ensuring a meaningful legacy for your family can stem from sharing your experiences with others. Overcoming adversity and achieving goals is more rewarding when you help others avoid errors in judgment and make informed decisions.
You can find more about Sylvia at www.sylviaguinan.com
If you want to talk about your divorce or need help moving out of the “A bomb went off in my life” phase, email me at info@cindyfinch.com
