After a divorce, you might unintentionally adopt bad money habits; these can make the process of picking up the pieces that much harder and compromise your ability to support your children, take your career to the next level and plan for long horizon projects, like a big trip or retirement. Here are 5 common destructive behaviors some men exhibit following separation… along with what you can do to sidestep them.
1. Failing to Update Names and Beneficiaries on Accounts
After your divorce, you should remove your ex from all accounts, including financial accounts that you hold at work. Remember to change the following: Bank accounts, IRA accounts, 401(k)s, Pensions and Life insurance policies. Change the title on your vehicle and home. Close joint bank and credit card accounts.
2. Failing to Review Your Estate Plan
Updating your estate plan will likely take more planning. You will likely need to remove your ex from the plan and designate new beneficiaries, power of attorney, and executor. Review all documents that list her (or him) in a fiduciary position, and reassess your strategy.
Given this project’s “not-urgent-but-still-important” nature, you might be tempted to put off working on it while you triage other aspects of your life and finances. That’s okay, but put a tickler in your personal organizing system to take care of it as soon as possible, against all other commitments.
3. Failing to Plan for Your Financial Future
Do the following:
- Inventory assets, property and liabilities.
- Establish a reasonable budget.
- Contact a financial advisor, and set up financial goals for your future for one, five, 10 and 20 years. A professional can craft an investment strategy that works for your needs.
- Plan for your retirement and/or recalibrate the plan that you had in place prior to the divorce.
- Plan for college or other educational needs for your children.
- Plan for child and/or spousal support.
4. Spending to Fill a Void
After an emotional blow, such as a divorce, you can easily compensate by developing unhealthy habits, such as overspending, to fill the void. Invest in therapy, instead, and pay attention to when and how you spend your money to keep a tight leash and avoid impulse purchases.
5. Problem Gambling
2.2 percent of the population struggles with a gambling addiction. Feelings of helplessness that arise during separation often drive men to engage in behaviors that they know intellectually are destructive – gambling, internet addictions, drug and alcohol use, sex addiction, etc. Recognize that you are not “bad” or “out of control” for having these impulses. In fact, new psychological research suggests that people engage in addictive/compulsive behavior as a pathological way to reassert control when life feels unmanageable. Instead of beating yourself up, look for more constructive ways to deal with the uncertainty in your life.
The California divorce team at the Law Offices of Silky Sahnan is standing by to help you handle the complexities of your separation. Call us now at 888-228-1098 for a confidential consultation.