Nine Financial Mistakes Women Make When They Divorce

By Emma Johnson, 

Check out Emma’s blog, here.

I try to avoid statistics that highlight how women and mothers are financially worse off after divorce. Why dwell on the negative? I don’t want to let these trends become a self-fulfilling prophesy for me. But through both expert and anecdotal research I’ve found that there are some common mistakes women make when facing life after divorce:

They’re in denial about the fact their lifestyle will change.

When families divorce, each party nearly always ends up poorer than when they were married (at least initially). This is especially true for women, who on average earn less than men and are straddled with a disproportionate share of child care. The beauty of marriage and cohabitation is the economies of scale when it comes to real estate, vehicles, division of labor and all the other things that go into living. When you have to maintain two homes and care for children without a second spouse, you get poorer. This is a fact.

If you refuse to accept this fact you will make decisions based on false premises – the premise that you have the same net worth, income and overhead as when you were married. You don’t any more (even if you got the house). It is time to have a harsh look at your expenses, income, goals and dreams, and make educated decisions based on those realities.

They go into panic mode and assume poverty. True, single motherhood is synonymous with poverty. The statistics back this up. But that doesn’t have to describe your family. It is natural to be afraid in times of upheaval and change. But if you don’t educate yourself about your true circumstances, your options and make a logical plan for yourself and your kids, you will be making decisions based on fear. And nothing good comes of that.

They give up the house too readily. Especially if you have the kids the majority of the time, it is likely a good idea to keep the house. When making a budget, don’t just factor the monthly mortgage, tax and insurance. Have an accountant calculate the net cost of that home – remembering that taxes and interest are tax deductible. And don’t forget: real estate is not just a roof over your head – it’s an investment that is often as valuable as stock holdings over the long-term. Another reason to stay put: Avoiding relocation removes an enormous stress from the entire family. Unless, of course, you just want to get rid of that bad-memory-filled shack and get on with it already.

They ignore their credit scores. Even when the rest of your life feels like chaos, it is imperative you maintain a strong credit score. This three-figure number determines a lot of your short- and long-term future. Without a solid FICO you cannot finance a car, home or sign up for utilities. A poor credit history can affect your ability to get a job, or refinance your house if you need to buyout your ex in the divorce.

They take on debt to make ends meet. Consider your divorce the first day of the rest of your life. You are no longer part of a couple – your finances and family life are starting anew. Sometimes some credit card debt can get you over a little hump. But few people can afford to finance a major life transition. Start off this new chapter on the right foot.

Women don’t ask for enough help. You are just one person. No one can do it alone. You need emotional support, sometimes a financial boost, professional favors and mentors. Sometimes it is OK to seek out assistance in the form of government help. Accept you may face a period of transition in which you open yourself up to the generosity of others.

They assume they can’t do it without a man. If it is one thing that happy, thriving women know is that they can survive more than they ever thought possible, and do more than they ever dreamed. The key is to let go of past notions of who you were as a wife and mother, shake out your limiting ideas about your career and potential income, and dream big and dream strong. Freeing yourself from a toxic marriage can open your energy up to achieving great things.

Women don’t re-evaluate their careers when they divorce. Your new life will likely mean you immediately have fewer resources for the same or greater expenses. How will you make up the difference? If you stay on the same career path, not much is likely to change. What can you do to make more money? Have more fulfilling work? A better work-life balance? Work with a mentor, take your boss out for coffee, explore education opportunities or opening a small business. Suddenly, the sky becomes the limit – not your old salary.

Women don’t dream big enough. I’ll say it again: Your divorce marks the first day of the rest of your life. This includes your romantic, professional, family and financial lives. Be grateful you are no longer tied to a bad relationship. Allow yourself to imagine a life bigger and better than the one you set out for the first time around. But be careful what you wish for. You just might get it.

Emma lives in New York where she is the mom to two preschoolers and is a fulltime business journalist and writer. She blogs at 

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