There will be many adjustments in one’s life after a divorce is finalized—from getting used to being single, to the situation of being a co-parent, to transitioning from two salaries to one. While all the emotional and situational adjustments are difficult, the financial adjustments can be one of the more stressful obstacles.
It is normal to feel overwhelmed during this period of transition, but rest assured, once a routine is established, these everyday situations and financial adjustments will become easier. To help one adjust more easily to their financial changes after divorce, below are a few tips and considerations for them to keep in mind:
What is my monthly budget now?
Before making any sudden decisions, evaluating one’s complete financial picture is key. Especially if someone went from having two incomes to one, making sure one understands what money they are bringing in each month—whether it’s from income, support, alimony or all these sources, in addition to their bills and debt payments—will help to paint a clear picture of where they stand and what their budget is each month. Having a clear budget will help them make smart decisions and stay on track financially. Also, consulting with an experienced financial advisor may also be beneficial.
Should I downsize or move?
Once a budget is established, it should become evident if one’s current mortgage will be reasonable or too expensive. If it makes one’s finances too tight each month, perhaps downsizing or moving could help. The last thing someone needs when adjusting to supporting themselves after a divorce is to be pinched for money each month and living paycheck to paycheck. While moving is not an easy task, in the long run, it can help reduce the financial burdens and obligations each month.
Is my credit in good shape?
When a couple is married, their credit score can be impacted by the other spouse’s actions and can follow each spouse post-divorce. Reviewing one’s credit report regularly can give them an idea of where they are, what’s impacting their score, and can help them figure out how to improve it. Some tips to improve one’s credit score might be: paying bills on time, avoiding hard credit inquiries and only doing so when needed, and not utilizing more than a small percentage of available credit – perhaps around 30% or lower.
RELATED: Read these tips on how to tackle credit card debt during divorce.
There are multiple adjustments someone newly divorced must overcome, and overcoming the financial hurdles can eliminate stress and make the other adjustments less difficult. If you are adapting to life after divorce or anticipating doing so in the future, we hope the above tips can help.
Are you approaching a divorce and need someone to help guide you through the steps to protect yourself and your family’s future? If so, our attorneys who are well-versed in all family law matters can help. Contact us now to set up a consultation however it is most convenient for you—via telephone, video, or in person.
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