Divorce - A real wealth hazard

Statistics show that the level of divorce in Australia is in excess of 50,000 divorces a year.  That's a THOUSAND A WEEK.  And apart from the problems, pressures, conflict and stress that comes with it, the wealth of those involved takes a big hit as well.

Not only does it see accumulated assets split (rarely 50/50 or particularly fairly) it puts weekly cash pressure on one or both of the divorcees.  Suddenly there are 2 lots of rent or 2 mortgages.  Unfortunately (but true) one or either parent spends more then they would otherwise on the children to curry their favour.  Some assets have to sold at "fire sale" prices just to generate cash, not getting the best return possible.  There are extra travel costs for visiting as well, just to pick a few added costs.

I'm not out to say people should never get divorced, because reality is some people should probably have never gotten married in the first place, and why live a life together if you're both miserable.  The argument that "we stay together for the kids" doesn't really wash either - it affects the kids more than some will realise or admit.

But to take a purely financial view, divorce will decimate the wealth creation and growth of those involved.  Apart from what I've said above, there's also the legal fees that are getting flushed down the toilet too.

Thinking of real estate, divorce is like buying a house then giving it someone you don't like.   Not good for wealth creation.

So of all the ways you could blow your wealth to pieces and make for a hard road back, divorce is, in my view, the greatest wealth hazard we all face.

Please note that nothing in this post constitutes financial advice,

and you should seek the advice of a professional licensed under AFSL regulations.

Life and its Trauma

Life is good, right?
You feel on top of the world, family are all well and business is kicking goals.

But then you get seriously ill or have a major accident.  Or worse still, you die.  What's this mean for your family?

Well, apart from the obvious despair, you hopefully have insurances to cover these possibilities.  You'd hate to leave your family stricken with no income and a heap of debts.
The insurances to consider include;

• Trauma
• also known as critical illness insurance
• covers a wide range of situations
• generally cheaper cover means less cover
• paid upon diagnosis
• provides a lump sum for medical care, mortgage, debt cover

• TPD
• total and permanent disability
• generally pays when you can no longer work
• has categories of "own occupation" and "any occupation"
• helps to pay debts, pay medical expenses and gives a future income stream

• Life
• paid upon death
• often has an age limit
• gets more expensive as you get older
• paid as a lump sum

You might also have income protection insurance and key person insurance in business.

Thy might not all be appropriate to your situation, but you're not doing right by yourself and your family if you haven't even had the discussion with them and an insurance professional.

You might think you can't afford it.  But as the old saying goes, can you afford to be without it?

Please note that nothing in this post constitutes financial advice,

and you should seek the advice of a professional licensed under AFSL regulations.