smart spending

5 ways divorce can cost you

Ignored retirement savings
Ignored retirement savings © arnet117/

A divorce is no boon for retirement savings. A recent study from ING found that the average divorced person had $11,000 less in retirement savings than the average married person, even though the average divorced person was five years older.

To recover, run a retirement calculator as you go through your divorce, says Jean Chatzky, financial editor for NBC's "Today" show and founder of "Money School." Add up your pension income, your new estimate for Social Security benefits and other retirement savings.

"Ask yourself if you have ground to make up that will require you to save more," says Chatzky.

Besides how much you have saved, you may also find that your mix of investments is out of whack after the divorce. You may have too much money in stocks or too many bonds, for example. Your investments should match your profile as a single person in terms of age, new retirement goals and risk tolerance, says Chatzky.

It may be time to seek a financial adviser for a session or two to rejigger your retirement goals.

"You're embarking on new course of life," she says. "You want to make sure you're headed in the right direction and not wasting time."


Show Bankrate's community sharing policy
          Connect with us

Discover new ways to cut costs and save more every day. Reduce your spending, not life’s pleasures. Delivered weekly.

Partner Center

Connect with us