Careful With Retirement Accounts Post-Divorce
There are many aspects about divorces that are public knowledge, but for some strange reason, details about life after divorce are relatively hard to find.
This is problematic, since the first few years after a divorce is finalized can be the most tumultuous part of the entire process, and can really set the stage for the rest of an individual’s life.
One of the major things that often goes by the wayside after a divorce is retirement planning, which is understandable and yet terrible at the same time. It is inarguable that finances are tight after a divorce, with household expenses effectively doubling for each spouse, but there are certain areas to cut down on and certain other areas not to.
The first thing to do is assess all the retirement accounts that you still possess. Do you have a 401k or a Roth IRA? Do you have stock index funds or bond funds? All of this information will need to be rebalanced with your expenses and income, and the amount you set aside each month will have to be adjusted.
Oftentimes, when looking over a financial portfolio after a divorce, many people will realize that they never really had an ironclad financial plan. Now that you are going over your finances, it would be a great time to figure those things out. The most important thing, however, is to keep growing your retirement accounts however possible.
It is understandable that you might need to put a temporary hold on your investments, but it is crucially important to your future that retirement accounts be the last things cut, and that you resume the investments as soon as possible. Time and compound growth are by far the most important parts of any investment.
If you ever have any questions about finances after your divorce, do not be afraid to get in touch with your divorce attorney. They will be able to provide the answers and insight that you might need.