Divorcees struggle to amass any savings

Young woman sitting depressed at the table because of financial problems
Young woman sitting depressed at the table because of financial problems

Divorced people are twice as likely as married people to have no savings or investments, and are more likely to handle their finances on a day-to-day basis.

While 32% of married people have managed to put money by, the same is true of only 14% of divorcees.

The reason is partly that they are poorer, but they are also managing their money less well.

In a survey from Zurich UK, it emerged that - despite very low interest rates - 36% of divorcees keep their savings in a current account, compared with only half of those who are married.

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And while 53% of married people are saving for later life, the same is true of only 28% of divorcees. Instead, around two thirds are saving towards a short term goal such as a holiday or tuition fees for a child or grandchild.

"Divorce can be an incredibly challenging time, both emotionally and financially. Understandably, the focus is naturally on splitting immediate assets, but it's important that the long-term is also part of the planning," says Anne Torry, Head of Zurich UK Life.

"In a low interest rate environment, a professional adviser can also help to create a plan and make the most of savings available. The earlier action is taken, the more likely it is that people will be able to achieve their aspirations now and in the future."

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Here are Zurich's tips for divorcees looking to bolster their finances:

1. Create a new budget
Creating a budget sheet will help you to keep track of your income and outgoings - and spot where you can make cutbacks. If you're unsure about how to get started then there are many tools available online to help, such as this one from the Money Advice Service.

2. Protect your credit score
You might be surprised at how many financial products and agreements you share with your ex-partner - from utility bills to mortgage repayments and credit cards. Their behaviour could impact your credit rating, making it harder to raise a mortgage or loan. Check your credit record, and make sure you...

3. Close joint accounts and open new ones in your name
It's really important to make sure that all joint credit cards and accounts are closed, paid off in full or at the very least changed to either your name or your former partner's. Not doing so could mean them using your accounts, running up debt or using your savings.

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4. Think about your pension
You and your partner may have built up a strong pension pot, so it's important to pay particular attention to how this is divided - especially for women who may have been counting on their husband's provisions for their retirement.

5. Don't forget about your protection needs
If you already have life cover in place in the form of a joint policy, make sure you check the policy terms. Some include a 'Joint Life Separation Option', which means that the contract can be amended to cover both parties individually. Many also let you increase the amount of cover you have, which you may want to do if you've had to take on a new or larger mortgage or other debts.

6. Make the most of your protection cover
Once you've changed your policy to protect you individually, it's worth making use of any support that is offered. Many protection policies contain financial, legal and even emotional support. Protection can also cover any maintenance liabilities for an agreed period, such as until children reach 18, or in the event of severe illness or even death.

7. Update your will
Now that you are divorced or separated, your existing will is unlikely to be appropriate to your new circumstances - so update it as soon as you can.