Financial illiteracy Can Hinder A Fair Divorce Settlement
When Tarrant and Denton County couples marry, spouses anticipate staying together for life. No one can be faulted for entering something as important as marriage with a positive attitude. However, most adults are aware a significant number of couples divorce long before they reach their golden years and that can really mess up a retirement plan.
If you don’t have a retirement plan, you’ve got company. According to a 2015 Fidelity Investments Couples Study 36 percent of survey participants hadn’t given a thought to retirement. The survey was conducted among more than 1,000 married couples and unmarried partners, ages 25 and older, with minimum assets of $100,000 or household incomes starting at $75,000.
Researchers learned nearly 50 percent of couples were unsure about the savings they’d need to fund retirement. About the same percentage was anxious about running out of money. An earlier Fidelity survey, conducted in 2013, showed more people had retirement plans and fewer people were concerned about outliving them.
A majority of respondents in the latest survey – 72 percent — claimed they communicated well with partners about finances. Unfortunately, 40 percent were clueless about how much a partner earned. Sixty percent couldn’t agree on anticipated Social Security payments for retirement.
The couples’ confusion over finances isn’t unfamiliar to divorce lawyers. Attorneys often see spouses totally unprepared to negotiate property division terms. In many marriages, one spouse – generally the husband — manages all the finances leaving the other spouse in the dark about the number and value of marital assets.
A financial education should not consist of a cram course during divorce. Fortunately, there are ways spouses can get up to speed on family finances even when they’re late learners. An attorney may be able to recommend financial advisers, forensic accountants and tax consultants to fill the gap left by a lack of knowledge about marital assets and debt.
Source: Forbes, “Divorcing Women: How Much Do You Know About Your Husband’s Retirement?,” Jeff Landers, July 29, 2015