The percentage of Americans age 15 and older who were divorced more
than quadrupled from 1960 to 2006, according to Rutgers University’s
National Marriage Project.1 And the U.S. Census Bureau estimates that
nearly 12% of Americans age 15 and over − 10.4% of men and 13.3%
of women − were divorced or separated in 2006.2 These percentages
translate into 11.7 million men and 16 million women who were divorced
Few people expect they will get a divorce, and even fewer adequately
plan ahead for the possibility. As a result, they’re forced to make
important decisions at a stressful and vulnerable time when they may
not be able to consider the long-term implications.
This checklist is intended to help you think about issues you’ll need to
consider should the possibility of divorce arise in your life. Generally, the
two major areas you’ll need to make decisions about are the division of
marital assets and the care of your children. Individual situations vary
greatly. Your fi nancial advisor and attorney, who are familiar with your
individual situation, can suggest other issues you may need to consider.
Identify all marital assets and decide how to divide them. Assets include:
• Investments. How will stocks, bonds, bank savings accounts, stock
options, etc., be divided?
• Family-owned businesses. How will business interests be divided?
• Retirement assets. How will 401(k)s, traditional IRAs, Roth IRAs and
other retirement assets be divided? How can the 10% early withdrawal
penalty be avoided? Have you updated your benefi ciary designation(s)
to refl ect your divorce?
• House(s). Who will live in the family home? Can that person
realistically afford to stay in the home and pay the mortgage, property
taxes, insurance, utilities and maintenance?
• Automobile(s). Who will make payments and pay insurance premiums?
Are the values of your vehicles approximately equal? If your automobiles
are paid for, who gets the title?
• Life insurance. Is it adequate? A