Money Matters [ Divorce Proof Yourself ]:

The worst thing you can do is to ignore money matters while you're married. Here are 9 ways to divorce-proof yourself now.

By MP Dunleavey

Most women get married believing their marriage will last "until death do us part," not "until he departs, taking all the money."

Yet the reality is that women are far more likely than men to suffer financially when their marriage unravels.

According to the National Marriage Project at Rutgers University, a woman's standard of living will drop by as much as 27% -- compared to 10% for men -- after a divorce.
While this may not be true for all divorced women, a grimmer picture does lie in wait for a specific group of women who:

  • Have stayed home with the kids
  • Are approaching middle age with rusty career skills
  • Let their mates handle most or all of the household finances

Thought they could count on their husband's income, savings and retirement to protect them -- and suddenly they can't.

While divorce is hard at any age, for women nearing midlife whose time and energy has gone into their families -- not themselves -- it's particularly important to shore up financial positions before a crisis strikes.

The Financial Fallout

I don't mean to make my gender sound weaker than we are. Plenty of women are not only equal financial partners in their marriages, they'll fight tooth and nail for their share if it ends. Look at Anna Nicole Smith.

But Marian, 51, one of the newest members of the Women in Red, says most women don't protect themselves. And she would know -- not only because her husband left her eight years ago without a job or a dime of support for herself and her three children, but because she's now a Certified Divorce Financial Analyst (CDFA) and she sees women get worked over all the time.

The No. 1 financial mistake women make? Marian and other divorce experts agree: Nothing makes you more vulnerable than ignoring money matters while you're married.

"Complacency is rampant in women," says Harlene Miller, a bankruptcy lawyer in Santa Ana, Calif., "If you don't know what's going out and coming in, if you don't know what the debt is or how much is left over each month, when a crisis arises you're going to have a real problem."

Expect the Unexpected

It may be daunting, but it's never too late to put yourself on firmer financial ground -- even if your marriage is thriving, and especially if it's not. "At the first inkling that your marriage may not last, begin being proactive," advises Marian, "but you should really be proactive from day one."

That means:

Get savvy. Take Miller's pop quiz:

  • Do you know what your husband earns?
  • What the monthly bills are?
  • Where your bank accounts are?
  • How much retirement you have?
  • Where the will is?
  • How much debt you have?

If you can't answer all of those questions, start digging for answers. Some experts suggest that spouses swap financial duties once a month so that both partners learn how the family's finances are run.

Pay attention. "Know what you're signing when you sign the tax return -- or anything else, for that matter," says Gayle Rosenwald Smith, author of "Divorce and Money: Everything You Need to Know."
Always read the mail, advises Smith, and if the mail goes to your spouse's office or a post office box, that's not a good sign.

Do the math. A big financial stumbling block for women is when they have to go from two incomes to one, or from his income to hers. Prep yourself by knowing any and all household expenses.

Stake your claim. Make sure your name is on all assets (house, car, boat or other property) and on all investment accounts. If you have valuable antiques or collectibles, keep copies of the appraisals.

Polish your resume. If your job skills aren't current, find ways to make them so. Take a class, get a part-time job, volunteer to work in a friend's business.

Take credit. Marian was shocked to find that many of her clients don't have a credit card in their own name. "It's essential that you establish your own credit before you leave the marriage," she says. If you're worried about falling into debt, applying for even a secured card can help to build a credit record -- which you'll need if you have to rent an apartment or lease a car, for example.

Be ready to downsize. The style to which you've been accustomed may not be the style you can afford, post-divorce -- a fact many women find hard to accept. But keeping up appearances can lead to big debt; single women with kids, many of them divorced, have the nation's highest bankruptcy rates. Consider a smaller house or apartment, a cheaper car or a tighter budget, at least until you're on your feet.

Don't run. When a marriage crumbles, many women just want to put the whole thing behind them -- which is often the worst financial move, says Marian. "It hurts so much, you just want to get him out of your hair, but we give up our financial security just to 'get it over with'."

Know your rights. If things are really rocky, consult with a good divorce lawyer or a CDFA, or both. Many women don't know their rights, says Smith, or they have misconceptions about what a divorce settlement might look like or how much alimony they might get. "A lot of women think, 'The courts will take care of me' -- wake up! You have to take care of yourself."

It's scary to think of a marriage ending. But just because you start taking financial responsibility now doesn't mean things will unravel further. If anything, your greater interest, participation and support around financial issues could bring you closer to your spouse.

Intimacy, after all, is the deeper issue. For couples who have reared a family together but perhaps lost track of each other in the process, the transition into midlife can be unexpectedly bumpy. Rather than let problems fester -- and possibly face the financial upheaval of a split -- it might be wise to invest in a better understanding of the different transitions you and your spouse are facing.

An empty or almost-empty nest, looming retirement, aging parents, college costs, a stagnating career -- all the travails of middle age -- these are the major financial and emotional issues couples need to grapple with.

And in the meantime, it can't hurt to get your own financial house in order. Just in case.

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