Tips to Help Women Better Manage Inherited Wealth or Divorce Settlements

Understanding Horizontal Wealth Transfers: What Women Need to Know

When we think of wealth transfer, the focus often centres on the traditional parent-to-child process known as a “vertical” transfer. But there’s another type of transfer that’s just as important and often comes first—“horizontal” wealth transfers.

A horizontal wealth transfer occurs across generational lines, typically between spouses, and is often triggered by significant life events such as divorce or the passing of a partner. In most cases, the recipients of this transfer are women—divorcees or widows—facing unique challenges as they navigate this shift.

The Unique Challenges of Horizontal Wealth Transfers

Horizontal wealth transfers differ significantly from vertical ones:

• Emotional Complexity: Divorce often comes with lingering conflict, while the death of a spouse can bring profound loneliness and emotional strain.
• Knowledge Gaps: Many women find themselves at a disadvantage in understanding family finances or managing inherited wealth.
• Advisor Relationships: After these transitions, women may need to build new relationships with financial advisors, lawyers, or other professionals.

Unlike vertical transfers, which are often planned and structured over time, horizontal transfers can feel abrupt and disjointed, leaving recipients to navigate uncharted territory.

Jane’s Story: Finding Stability with Expert Guidance

Take Jane’s* story as an example. After a challenging three-year divorce settlement, she received the family home, cash from the business, and an equities portfolio. Though she was financially secure, Jane felt lost and overwhelmed by the sudden responsibility of managing her wealth.

Jane confided in a trusted friend who introduced her to one of our female financial advisors at Morrows. Together, they worked closely to create a tailored plan that addressed Jane’s immediate and long-term needs.

Through thoughtful planning, Jane was able to:

Secure her financial future with a diversified investment strategy.

Gain confidence in managing her wealth with ongoing guidance and education.

Prepare a plan for a comfortable retirement.

Establish a legacy plan to ensure her children were looked after.

With time and the right support, Jane found clarity and confidence, ultimately designing a life aligned with her goals. Today, she sleeps well knowing her finances and future are in capable hands.

Preparing for the Unexpected

Whether you’re anticipating a horizontal wealth transfer or facing one unexpectedly, preparation is key:

• Clarify Goals: Work with a team of trusted advisors to articulate your financial and personal priorities.
• Educate Yourself: Take the time to understand your finances, including superannuation, insurance, and estate planning.
• Build Your Support System: A trusted team of professionals can help you navigate the complexities of your unique situation.

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