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Kim Butler

Partners for Prosperity, Inc.

City:Mt. Enterprise

State: TX

I have 20+ years of handling alternative investments in cash, growth and income for clients nationwide.  I strive to help my clients with all things financial in every way possible over the phone and the web.  I own an alpaca farm which I enjoy working during my downtime.  I also enjoy gardening, writing and reading books.  I also train other advisors on Prosperity Economics.

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Divorce Insurance: Deal or No Deal?

| BY Adriana Reyneri

Does divorce insurance make good financial sense? Not everyone is in love with the idea.

Married couples wishing to defray the costs of a legal breakup can purchase divorce insurance, but some experts say the product doesn’t make financial sense.

Couples considering divorce insurance should first calculate the chances of their marriage falling apart, advise the providers of Wedlock Divorce Insurance. The company website even includes a Divorce Probability Calculators, which weighs factors such as whether a spouse comes from divorced or single parents. That variable, alone, raises the likelihood of divorce by a factor of three, according to Wedlock. Second marriages have a 67 percent chance on ending in divorce. Youth also lowers the odds of a lasting marriage with more than 70 percent of marriages ending in divorce when one or both spouses are under the age of 22.

Divorce takes both an emotional and financial toll on both spouses, according to the website Divorce Insurance Info, and divorce insurance can help cover some of the costs of splitting up. Wedlock offers policies starting at $15.99 per month for $1,250 in coverage, but couples must be married for at least four years to receive the payout. A premium of $319.80 percent per month will pay out $25,000 in the case of divorce after four years of marriage. An accelerated maturity rider reduces the waiting period to three years. Insurers describe divorce insurance as “win-win.”

“If you don’t get divorced, then you’re more fortunate that many,” states Divorce Insurance Info. “If you do get divorced, and you insured for it, then you’ll be left in a better financial position compared to not having it.”

Consumer advocates disagree. Clear View Divorce, an online divorce mediation service, says simple math discounts these claims. In a recent blog Clear View said, “While planning for an eventual divorce may seem like it goes against the nature of marriage, such considerations need to be taken into account when just about half of marriages end, according to many divorce mediators. However, divorce insurance is far from the best way to accomplish this.”

Prenuptial agreements can help protect couples from financial ruin in the event of a divorce, says Clear View, and can be created for less than $700 using online services such as LegalZoom’s Standard Attorney-prepared Prenuptial package. Divorce mediation can also help reduce legal expenses. Other advocates say couples would be better off saving money in an emergency fund than purchasing a policy they may never need.

Divorced individuals – particularly women – have an increased chance of living in poverty, according to the latest U.S. Census Data, which measured a growing wealth gap between divorced and married Americans. Millionaire Corner research has also established a strong correlation between s successful marriage and financial success. More than 80 percent of Millionaire investors surveyed in December are married, and another 6 percent are widowed and a relatively low 5 percent are divorced.