Dealing with divorce or the loss of a husband are some of the most difficult experiences in life. But in addition to coping with change or tragedy, you also become solely responsible for overseeing and/or resolving a variety of other issues as well. Family finances, for example, should always be re-visited during these times to keep your assets in line.
According to The Wall Street Journal, women will receive $25 trillion over the next 20 years as a result of divorce, death of a spouse, or inheritance. However, women aren’t always as involved as their husbands in the daily management of their family finances or investment portfolio. As a result, they often end up in charge of matters they may not be entirely familiar with. (There are plenty of families in which the wife passes away and leaves the husband in a similar circumstance – the advice here applies to them as well.)
To prevent mismanaging your assets, here are some wealth management tips to help you get through this difficult time:
- Avoid making hasty decisions. While you may feel pressured to move or sell property, steer clear of making any drastic decisions too quickly. Give yourself time to figure things out and avoid spending money on a whim. Make sure you assess your financial situation prior to committing to any money-related issue, such as giving out loans or making large purchases.
- With that said, allow yourself to mourn and deal with this significant life change. As you take care of your own needs and overall health, you’ll ultimately be able to make smarter financial decisions later on. It’ll also give your advisor more time to make better recommendations for you and your family.
- Assess your current financial situation. Women who have lost or divorced a spouse will often need to determine if they must make new investments or withdraw from current ones. By conducting a risk assessment with your advisor, you’ll be able to make smarter investment decisions, gain a better understanding of your overall portfolio, and even identify your personal risk preferences.
- Determine necessary expenditures and create a budget. Even if we’re talking about tens of millions of dollars, it’s important that you identify your monthly fixed expenses and create a spending plan. No matter how much money there is, it’s a finite number. Creating a budget will also help you make wiser investment decisions and maintain a savings balance.
- Deposit income monthly into a bank account. If you’re not working, you may want to ask your financial advisor to deposit money into your bank account so you have a “˜paycheck” that covers all necessary expenditures each month.
- Set up quarterly meetings with your financial advisor. By doing so, you’ll be able to not only stay up-to-date on your investments, but learn more about each one as well.