The Three Most Common Money Mistakes Women Make BEFORE Divorce and What You Can Do to Avoid Them

Divorce can be emotionally wrenching. From redefining your identity to redesigning your day-to-day living circumstances, there are plenty of tasks to occupy you and difficult feelings to process.

As psychotherapist Wendy Hammond says in her lovely book, Leaving the Castle: Finding the Confidence to Start Over, “Imagining a life beyond this, where [you] can be both creative and financially stable, seems impossible.” I’m here to tell you it’s most definitely possible.

However, during the last twenty years I have seen many women fail to take steps that could have helped them in the long run. I don’t want you to go through any avoidable financial hardship or added emotional turmoil. Here are the three top mistakes too many women make followed by simple strategies to make sure your finances are in good shape, whether their relationship lasts or not.

The Three Most Common Money Mistakes

  1. You don’t have any money in your own name.
  2. You don’t know what you own and what you owe.
  3. You don’t know how much money you would need to live on your own.

1. You don’t have money in your own name

Divorces is expensive. Do you have access to funds to pay for legal fees, housing, and living expenses? In contentious divorces, an angry spouse can use money as an attempt to control or punish. Make sure you have following in place.

  • Have at least one bank account with only your name on it. If you have money in joint accounts, that gives either one of you the right to withdraw everything without knowledge or consent of the other.
  • Put money in your account.
  • Build up the balance a little at a time.

Having your own money is emotionally empowering, pragmatic, and necessary. One of my clients was desperate to leave her husband, but felt stuck because she felt she couldn’t afford to leave. Our work together started with her creating a bank account under her name.

2. You don’t know what you own and what you owe

If you proceed with divorce, there will be a process of dividing the marital assets. If you have delegated dealing with finances to your spouse, you probably don’t know what you have or where it is. Debts including mortgage, car loans, credit cards, and student loans can be split in divorce as well. Don’t overlook these tasks.

  • Locate your records and statements. Keep extra copies in a secure location.
  • Make a list of your banks, investment companies and lenders. If everything is handled online, learn the login and passwords.
  • Get a copy of your and your spouse’s most recent Social Security statement. They no longer mail them to people under age 60, so you’ll need to log on to

Knowledge is power. A woman scheduled a session with me when she was going through a rocky time in her marriage and realized she was completely uniformed about the marital finances. We reviewed a list of questions she should ask her husband to get a handle on what they owned and what they owed.

3. You don’t know how much money you would need to live on your own

Right now you may be running a household on two incomes, yours and your spouse’s. If you divorce, you may be entitled to alimony and child support for a time. But even so, afterwards there will be two households to run on the same amount of income. It is important to know how much you will need if you’re on your own. Make sure you are familiar with the items below.

  • Get a handle on your current expenses and cash flow. Where does the money go now? How much do you pay for housing, utilities, transportation, insurance, taxes, food, healthcare, personal care, activities, gifts, and entertainment?
  • Think about what would change if you were on your own. For example, where would you live and what would that cost? Would your transportation costs change?
  • Don’t forget health insurance. If you have been getting it through your spouse’s work, what would it cost on your own? Can you get it from a job, or would you have to buy it yourself?

While it’s impossible to predict exactly what you might get in a divorce settlement, you can start by looking at 50% of everything. A client was about to initiate a divorce and came to me with all of her financial records to sort through. We were able to proceed with a plan that would protect her in the months and years ahead.

I believe that every woman should be in control of her finances whether or not she is considering divorce. If you haven’t already, take the three steps while you and your partner are happy and content with each other. Money is a huge source of relationship stress and the impetus behind many breakups.

If you are facing divorce, reach out to your support systems. You don’t have to do it on your own. Hire an attorney you can relate to, a caring therapist to help emotionally, and a financial advisor to help you make the best money decisions.

To quote Wendy Hammond again, “As you walk forward, your inner resources will rise to the challenge. You are enough for this journey, as you are right now.”

Do you have questions or need support? My job is to help women make informed choices. Call me for a free 20-minute consultation.

*Note – each individual’s case and outcome will be unique.

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