Experts say divorcees must plan carefully for retirement

When you are in the throes of a divorce, it can be difficult to think of anything other than the matter at hand. Given how detailed divorce proceedings seem to be and how carefully attention must be paid to just about everything, that is, to a degree, understandable. Unfortunately, it seems that many divorced people do not think far enough ahead and are not saving enough for the single life ahead of them.

For instance, investment firm Charles Schwab recently found that while 85 percent of married Americans save for retirement, only about 67 percent of people who either have never been married or are divorced are doing the same. Retirement experts say both numbers should be higher, but the fact that single people are saving at a lower rate means they represent a demographic that seems to need more prodding.

One retirement expert said married people seem to save more because they are accountable to another person — a husband or wife. Single and divorced people do not have to answer to anyone and this creates the illusion that they can put off saving for retirement. Most financial and retirement experts would agree that it is never too early to start saving, so this impression can be bad if it lasts for too long.

A divorce expert also said that after a split, some people choose to “treat themselves” for awhile and then fall into a pattern of overspending that cuts into how much they can save. She said if you start saving right away, even if it is not much, you get used to the idea and it becomes a habit.

If you are interested in more information about being financially prepared, your attorney may have some websites or other resources to recommend. He or she will also likely know of a financial planner or other money-matters expert to whom you could be referred.

Source: Daily Finance, “Retiring Solo: Too Many Single and Divorcees Aren’t Saving Enough,” Catherine New, Sept. 14, 2011