Protecting Yourself Financially After Divorce: A Real Life Example

In this episode of *Middle Class to Millions*, Shannon deviates from her planned content to address an important issue she’s seen arise frequently: the financial impact of divorce, particularly for women. She shares the story of a client who, nearly two years post-divorce, is navigating a difficult financial situation after a lengthy marriage marked by financial infidelity. 

 

**Key Takeaways:**

 

- **Financial Infidelity in Divorce:** Shannon explains the effects of financial infidelity during divorce, where one spouse hides assets or stashes money, leaving the other spouse in a vulnerable position. Even in high-income households, the lack of financial awareness can lead to devastating consequences.

  

- **Lifestyle Adjustments Post-Divorce:** After an 18-year marriage and a high household income, the client finds herself adjusting to a drastically different financial reality. Despite earning six figures, she's accumulated debt, particularly from the cost of mental and emotional self-care during the divorce process. Shannon highlights how important it is to adjust spending habits to avoid accumulating unnecessary debt after major life changes.

 

- **The Panic of Debt:** Shannon discusses the common emotional response to accumulating debt: panic. This emotional state often leads to poor financial decisions. She reassures listeners that debt can be tackled methodically with a clear strategy and timeline.

 

- **Bad Financial Advice and Avoiding Impulsive Decisions:** The client received advice to sell her home in order to deal with her debt, but Shannon advises against this. Selling a home, especially one with significant value, is often an impulsive decision driven by panic. Shannon emphasizes the importance of seeking professional advice before making big financial decisions.

 

- **A New Path Forward:** The client, who’s been in an unfulfilling job for 12 years, dreams of taking a six-month sabbatical to reset her life. Shannon supports her vision and works with her to develop a plan to pay off debt, manage her finances, and set up new income streams, all while taking time for self-care.

 

- **Financial Literacy for Empowerment:** Shannon highlights the importance of financial literacy, particularly for women. Knowing how to manage and invest money empowers individuals to create financial freedom, reducing dependency on a job or a partner. The goal is to have money working for you—not just working for money.

 

- **Living Beyond Basic Needs:** Shannon challenges the idea that financial security means just having a roof over your head and food on the table. She advocates for a fuller life, which includes enjoying travel, hobbies, and pursuing passions, without financial worry.

 

- **A Strategic Approach to Debt:** Shannon encourages listeners to have a strategy for managing debt, but also to keep living their lives in the meantime. It's not about waiting until every debt is cleared to move forward; it's about taking a proactive, well-thought-out approach to debt management.

 

**Actionable Insights:**

 

- **Know Your Finances:** Don’t rely solely on your partner (or ex-partner) for financial information. Understand where the money is, what it’s doing, and make sure you’re not in the dark about your household finances.

  

- **Seek Professional Guidance:** If you’re dealing with complex finances post-divorce, consider working with a financial advisor or coach who can guide you through the process of creating a debt repayment plan, building assets, and investing for your future.

 

- **Take Control of Your Financial Future:** Whether you’re dealing with a divorce or not, Shannon encourages everyone to take charge of their financial future by learning how to invest, create income streams, and grow assets. This can give you the peace of mind to live the life you want, without relying on your job or a partner.

 

**Listener Action:**

- Have questions about divorce, financial protection, or how to navigate a major life transition? Leave a comment or reach out to Shannon to learn more about creating financial security for yourself.

 

This episode offers a relatable and practical approach for women (and anyone) who may be navigating financial challenges after a major life event like divorce. Shannon’s candid advice and emphasis on financial literacy are powerful reminders of how important it is to be in control of your financial future, no matter the circumstances.