Each year thousands of women find themselves in situations where they have to suddenly transition to managing their finances on their own.
Whether it’s due to divorce or the death of a spouse, the adjustment to living on your own and being responsible for every decision in the household can be quite frightening and overwhelming. In particular, when it comes to money, the worries are even greater.
Many questions can run through your head from, “Will I have enough to live on?”, “Will I have to go to work?” and “How do I know where to invest my money?” to, in some cases, “How do I even pay a bill?”.
It might sound crazy that in this day and age there are still people who don’t know how to pay bills, but with life being so busy and demanding it’s very easy to let someone else manage the finances.
Women in this situation represent a cross section of the community. They are wives of successful businessmen, educated women with high achieving jobs, women brought up in affluent families and stay-at-home-mums. Now, before we start judging these women, you could say that it’s quite efficient having each partner of a couple responsible for their role and ‘position on the team’. The home seems to run smoother when everyone is doing their thing.
Where the issue begins is when you no longer have you team-mate by your side and you are left doing your thing and theirs.
When a divorce settlement is imminent or the family wealth is left to the surviving spouse, making decisions independently can be very intimidating and lonely. Decisions often need to be made at a highly emotional and vulnerable time and this is when it’s critical that there is support.
It’s important to make these decisions wisely. Women on average live longer than men, have lower salaries and accumulate less superannuation due to time out of the workforce to raise children. It’s crucial that women make sure their finances are will manages, so they can live a comfortable life now and later down the track when they stop working.
Getting good quality advice is important. This doesn’t mean advice from a well-meaning friend or a hot financial tip from a colleague. A qualified financial adviser can work with people to help them manage their finances and set them on the right track after life events like divorce, or even worse, the death of a loved one.
I have seen, too many times, women being taken advantage of by, what I call predators. You know, the young boyfriend with the great business idea, the best friend who thinks you deserve the trip of a lifetime and you just can’t go on your own, unscrupulous people who call themselves professionals and sadly, even the children.
There is no need to be alone and certainly there should be no guilt for any past lack of involvement. We can’t be great at everything and we don’t have to be. We just need to be smart.
Below are some tips on how to be smart when you find yourself alone with money:
- Take your time. Don’t make any decisions until you completely understand your financial position.
- Educate yourself. Start learning slowly how to do basic tasks and gradually build from there
- Seek advice. Find a professional who understands you. This is your time and you need to be surrounded by people who can help you navigate through this difficult time.
Moving Forward is a process. There are many adjustments to life after a divorce or death of a spouse and it takes time to transition and heal. We may not have as much time as we need to address some issues but when it comes to your money, it’s important to remember that whatever you have may need to last you for a very long time.
Esther Althaus is an Authorised Representative of AMP Financial Planning Pty Ltd, ABN 89 051 208 327, AFS Licence No, 232706.
Any advice given is general only and has not taken into account your objectives, financial situation or needs. Because of this, before acting on any advice, you should consult a financial planner to consider how appropriate the advice is to your objectives, financial situation and needs.