Rebuilding After Divorce • Age 47 • $1.2M in Assets

Written by Hazel Secco, CFP®, CDFA®

Client Snapshot

• Who: “Maria,” senior web designer at a mid-sized firm, age 47, divorced 3 years ago, daughter about 7 years from college
• The situation: $1.2M from the settlement: a $650,000 IRA rolled over from her ex-husband’s 401(k), $300,000 in cash, and roughly $250,000 in a brokerage account, all still invested exactly the way it was the day the divorce was final
• The problem: Three years had passed, and the questions were getting louder:

The Weight She Carried

The divorce was final three years ago, but her money never got the memo. The QDRO settlement sat in an IRA in her name, still in the exact allocation her ex-husband and his banker had chosen. That banker kept calling, and she knew she wanted advice. She just didn’t want it from her ex-husband’s guy.

Then a quarterly statement arrived showing the IRA down 6%, and she realized she couldn’t explain why. The answer was in the allocation: 100% aggressive equity, built for someone else’s risk tolerance. Add her first tax seasons filing alone, $300,000 in cash earning next to nothing, and her ex’s name still sitting on beneficiary lines, and the feeling crystallized: this was all hers now, and none of it was actually hers yet. She didn’t need someone to scare her. She needed someone to show her whether she was on track, and how to make it hers.

What We Did: How Align360™ Worked for Maria

We mapped everything in one place: the IRA, the cash, the brokerage account, the insurance, and the documents. The picture told the story. Her ex was still the beneficiary on accounts he no longer had any business touching, the IRA allocation was built for someone else’s retirement, and nearly a quarter of her wealth was sitting idle in cash.

First, we ran a real risk assessment, hers, not his, against her actual goals: college in seven years, retirement after that. The all-equity portfolio was more risk than she could live with, but with years of growth still ahead, going too conservative would cost her too. We landed on moderately aggressive: growth-oriented for her timeline, with enough balance and flexibility to handle the extra expenses that often come in the early years after a divorce.

Then the tax work: as a head of household earning $80,000, Maria sits in a much lower bracket than her married years, which opened the door to a multi-year Roth conversion plan on the $650,000 pre-tax IRA, converting just enough each year to fill her lower brackets without spilling into higher ones. We planned the cash and brokerage redeployment around capital gains, so putting the money to work would not create a tax bill she wasn’t expecting.

We consolidated 6 scattered accounts down to 3, reallocated the IRA from 100% aggressive equity to her moderately aggressive plan, put the idle cash on a schedule toward her college and retirement goals, and rebuilt the paperwork of her life: a new will, every beneficiary corrected, and a new power of attorney and healthcare directive naming people she actually trusts. And none of it is set in stone as we review everything together every year and adjust as her needs and goals evolve.

The Transformation

Maria’s money finally caught up with her life. Every dollar is now invested around her plan, not his, and her projection shows her fully out of work by 65, on track. The IRA is invested for her timeline, the cash has a job, the Roth conversions are quietly moving money to the tax-free side while her bracket is low, and her daughter’s college fund is building on schedule without derailing retirement. The banker stopped calling. It stopped mattering.

Your Next Step

What would it take for your settlement to finally feel like your money? If your accounts are still frozen in a life you’ve already left, let’s find out together. The first call is complimentary, a chance to see if we’re mutually a good fit. Book your Align Call here.

This case study is hypothetical, does not involve an actual Align Financial Solutions client, and is provided for illustrative purposes only. It should not be construed as a guarantee that any client will experience the same or similar results.