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What women need to know about mid-life divorce

The divorce rate is going up primarily among one age group these days: people who are over 50. It's being called "gray divorce," and while you may have already heard about it, did you know that divorce over 50 carries specific financial risks for women?

In general, women are at a disadvantage because they haven't had the same earning power as their husbands during the marriage. In addition to the gender pay gap, women's incomes may have suffered from sacrificing time at work in order to be stay-at-home moms for the couple's children. Whether they're in the workforce now or not, the majority of women who get divorced at mid-life won't be as well positioned to handle the financial challenges that accompany it. 

Before the divorce, know your finances

While you can't be completely ready for everything that comes your way during a divorce, due to the emotional and financial toll the process takes, you can act in your own best interest by doing the following four things:

1. If you don't already have your own, separate bank account, open one now. The same goes for a credit card or two. They might be more difficult to acquire after the divorce if you don't have a substantial credit history or current employment.

2. Find out what insurance policies you'll need to finance on your own going forward. In addition to health insurance, you'll need car, property and life insurance, at the very least. You might want to carry long-term care or disability insurance as well. Discovering what these policies will mean for your finances is an important aspect of divorce planning.

3. Learn what to expect from Social Security and retirement plans. You may already be retired, or you may be 10 years out or more. Either way, knowing the exact numbers is crucial. The retirement savings you've accumulated might not measure up to your husband's, because you assumed you'd be sharing that pool. Now that you won't, what can you do to build up your retirement savings?

4. Create a budget and track your spending now, as opposed to later. You'll want to start learning how to adjust your lifestyle and the best way to do that is to lower expectations for your future standard of living.

While mid- or late-life divorce may not have been in the game plan, you can take action now to avoid ending up in bad financial straits once you're single. If you have concerns, an experienced divorce attorney can help you prepare for this major life change.

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