Recently divorced? These 5 financial steps will help you move confidently into future

Your divorce settlement has been finalized. So what happens next? You may be feeling exhausted and relieved that the divorce is finally over, but the fact is your work is not yet done. These essential steps will help you see the process through to completion and move confidently toward the future.

▪ Don’t procrastinate. It’s critical to tackle the changes required in your divorce agreement as soon as possible and before problems arise, such as unauthorized transfers or market fluctuations. This step will take time and it may feel overwhelming. But in the end ignoring your finances could lead to disastrous consequences.

▪ Get expert guidance. Divorce is a complex life-changing event and you will need help from a trustworthy financial professional.

Look for advisors with credentials such as Certified Financial Planner (CFP) or Certified Divorce Financial Analyst (CDFA). Referrals from your attorney are a good place to start but take the extra step of checking the advisor’s background with the SEC at Investment Adviser Public Disclosure.

Interview several candidates and pay attention to how well they listen to your specific needs. The advisor should also be clear and transparent about fees for their services.

▪ Complete all tasks required in your agreement. Go through the agreement line-by-line with help from your attorney or financial advisor. List all action items, tackle them one-by-one and keep good records.

These steps may include dividing investment accounts, bank accounts or other financial assets; filing Qualified Domestic Relations Orders (QDRO) if needed to divide retirement plans; selling or re-titling property such as vehicles or real estate; setting up automatic payments for child support or alimony; and setting up a record-keeping system with your ex-spouse for shared expenses such as children’s health care or education.

▪ Plan for a bright new future. Celebrate your new beginning. Now is the perfect time to dream big, face your fears, or maybe a little of both. With thoughtful planning and professional advice, you can get answers to burning questions such as: Can I afford to keep the house? How much insurance do I need? How much will I owe in taxes?

Also ask yourself these questions: Do I have enough income and assets to live comfortably for the rest of my life? If not, what adjustments do I need to make? What happens when alimony and child support payments end? Will I need to make major lifestyle changes?

▪ Work the plan. You have now reached the final step of implementing your new plan. This may include setting up a cash flow system to make it easy to stick to your budget; re-building emergency funds; fine-tuning your investment strategy; updating wills, trusts and beneficiaries; refinancing mortgages; plugging an insurance gap and implementing tax-saving strategies.

Financial planning is not just about numbers: it’s about securing your future and reclaiming your independence. Embrace the opportunity to pursue your dreams with renewed confidence. Stay focused and celebrate each milestone as you build the life you deserve.

Cindy Richey, CFP, CDFA is president and wealth manager at Prosperity Planning Inc., a registered investment advisory firm. Cindy is a member of the Financial Planning Association of Greater Kansas City.

Do you have financial topics or questions you’d like answered by a CFP professional? If so, submit your question or topic to KCFPA@gmail.com and your topic/question may be featured in a future article.