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The Biggest Financial Mistakes People Make in Divorce and How to Avoid Them

Financial documents with pen and  note that "Mistakes To Avoid"
Divorce doesn't have to destroy your finances—learn how to navigate money matters with clarity and confidence.

Divorce is not just a legal and emotional process—it’s also one of the most significant financial turning points in a person’s life. The decisions you make during divorce can impact your finances for years to come. At Optimal Divorce Solutions, I work with clients across the U.S.—especially those in high-net-worth and gray divorce cases—to avoid common financial mistakes and walk away with clarity, stability, and confidence in their future. Let’s explore the most frequent financial missteps I see and how to sidestep each one.

Underestimating Future Expenses

Why It's a Problem

Many people focus so much on dividing current assets that they overlook how their post-divorce lifestyle will actually look and cost.

How to Avoid It

  • Create a post-divorce budget based on realistic living expenses

  • Factor in housing, insurance, retirement contributions, taxes, and healthcare

  • Consider inflation and changing needs over time

Fighting for the House (Without Doing the Math)

Why It's a Problem

Keeping the marital home can seem emotionally comforting—but if it becomes a financial burden, it can turn into a liability.

How to Avoid It

  • Evaluate if you can truly afford the mortgage, taxes, and upkeep

  • Consider selling and dividing equity instead

  • Work with a Certified Divorce Real Estate Expert (CDRE) to assess options

Not Understanding Tax Implications

Why It's a Problem

Dividing retirement accounts, selling property, or receiving spousal support all have potential tax consequences.

How to Avoid It

  • Consult a CDFA® or CPA early in the process

  • Understand how capital gains, income taxes, and alimony rules affect your settlement

  • Use a Qualified Domestic Relations Order (QDRO) for splitting retirement accounts

Ignoring Hidden or Complex Assets

Why It's a Problem

Business interests, restricted stock, cryptocurrency, or deferred compensation plans can be overlooked—or intentionally hidden.

How to Avoid It

  • Work with a divorce financial professional to uncover all assets

  • Review tax returns, bank statements, and business documents thoroughly

  • Consider hiring a forensic accountant if needed

Forgetting About Debt

Why It's a Problem

Many people focus on assets and forget that marital debt must also be divided—and creditors may still come after you even if your spouse was "assigned" the debt.

How to Avoid It

  • Identify all debts, including credit cards, loans, and lines of credit

  • Try to pay off shared debts before finalizing the divorce

  • Refinance or transfer debts into individual names when possible

Overlooking Retirement Planning

Why It's a Problem

Divorce can derail retirement goals if you're not strategic.

How to Avoid It

  • Ensure fair division of retirement accounts

  • Rebuild your retirement savings as soon as possible

  • Adjust your investment strategy to match your new goals and risk tolerance

Making Emotionally Driven Decisions

Why It's a Problem

Divorce stirs intense emotions, but financial decisions based on anger or guilt often lead to long-term regret.

How to Avoid It

  • Separate emotion from financial decision-making

  • Work with professionals who provide objective guidance

  • Focus on long-term goals, not short-term wins

Not Working with the Right Professionals

Why It's a Problem

Relying only on your attorney may leave financial gaps unaddressed.

How to Avoid It

  • Partner with a Certified Divorce Financial Analyst (CDFA®)

  • Engage a Certified Divorce Real Estate Expert (CDRE) if property is involved

  • Use divorce mediation or coaching for a more informed, empowered process

  • Understanding the Role of a CDFA® in Divorce

  • What to Do If Your Spouse Controls the Finances

  • How to Track Down Hidden Assets in Divorce


Key Takeaways

  • Financial mistakes during divorce can have lifelong impacts if not handled carefully

  • Budgeting, understanding taxes, and identifying all assets are key

  • Don’t overlook debts, retirement planning, or emotionally driven decisions

  • Work with the right professionals—like a CDFA®, CDRE, or divorce coach—for clarity and protection

If you’re preparing for or currently navigating divorce, don’t go it alone. I’m here to help you avoid these financial missteps and move forward with confidence. Let’s protect your future—starting now.

Lisa McNally

Certified Divorce Coach | Certified Divorce Mediator

Certified Divorce Financial Analyst (CDFA®) | Certified Divorce Real Estate Expert (CDRE)

Licensed Real Estate Broker (NH & ME)

Founder, Optimal Divorce Solutions


© 2024 by Lisa McNally, Certified Divorce Mediator, Coach & Financial Analyst

I, Lisa McNally, am not an attorney, financial advisor, tax advisor, or therapist. The services offered by Lisa McNally/Optimal Divorce Solutions, including mediation, coaching, and financial analysis, provide general guidance and support. For legal, financial, tax, or mental health issues, please consult a licensed professional.

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