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Consider retirement planning during divorce negotiations

Because of the increasing numbers of divorces coming later in life, a focus on retirement issues is important. This may be particularly applicable in Florida due to large segments of retirement-age residents. Due to divorce, several programs and funds that two people had together must now be re-designed as a separate unit for each person.

The first step is for the spouse to re-define what she or he wants 10 years into the future and then looking at the assets to see how that can be reconfigured. Where substantial retirement and other assets need to be divided, the participants may be assisted by a certified financial planner working in conjunction with their divorce attorney. One thing to weigh is the long-term benefit vs. the short-term benefit of keeping an asset or taking cash in the process of dividing property.

Sometimes taking cash is not as wise as taking the asset, which may provide for future growth and even income payments in the future. In the same way, taking the house instead of retirement or pension benefits can be a wrong choice for some. A mix of assets and cash must be evaluated to see how it can serve to implement a person's current needs and retirement plans.

People have numerous questions to be answered during the divorce process. One question is whether the individual can retire in five or ten years. Will they have to work extra or do something else additional to supplement their assets? A problem is that emotional turmoil can cloud up rational decision-making. The challenge is to keep putting a positive face on initially negative thoughts.

After divorce the individual should not get attached to the assets over and above developing a new lifestyle and enjoying life's activities. Insurance policies must be checked and updated. These include the basics of life, health, auto and home. Others that may be important are disability and long-term care planning.

The key to starting over after divorce is education and information. Remain informed and you'll do okay for yourself. Whether you live in Florida or elsewhere, the informed and knowledgeable person has a strong level of confidence. This really cuts down on acting out of fear of the unknown.

Source: Forbes, Saving Your Retirement From A Divorce, No author, Oct. 21, 2013

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