Tips for Financial Stability After Divorce

 Posted on October 09, 2015 in Divorce

Divorce is about ending an unhappy marriage and starting new. Starting new, however, is easier said than done. For most divorcing couples, the transition from married life to independence is challenging. Changing from a life of support from your spouse, and the financial security of two incomes is tough. The happiest, most successful, divorcees are those that plan ahead for their upcoming life as a single person. Financial preparedness can help make your transition much less stressful. Provide yourself with financial peace of mind by following these key tips.

1. Assess Your Current Financial Situation

One of the most common misconceptions about divorce is that lifestyles will remain the same. You and your spouse's incomes may have supported a very comfortable life together, but that same amount of money is not going to stretch as far for two separate households. To help you better prepare for financial independence, assess the income and expenses of your current shared household. Review your bank and credit card statements. Consider all income sources that you and your spouse share. Once you have a handle on your combined income and expenses, you will be able to map out your upcoming expenses as a single person and if you will be able to afford them or not.

2. Create a Plan

Now that you have a clear picture of your finances during marriage, you can begin planning for your income and expenses as a single person. Start with your short term expenses. What will your rent cost? Utilities? Then make plans for future expenses like college tuition, if you have children, or retirement. Then consider your income. Did you have a job during your marriage? If not, looking for a career to help cover your expenses may be necessary. Also, remember to include any form of support you may be receiving from your divorce. Extra income like alimony, child support, and any leftovers from your divorce settlement should be included in your plan.

3. Embrace Difficult Changes

Many people attempt to hold on to their previous lifestyle after they are divorced. For some, maintaining an old lifestyle that was funded by two incomes becomes impossible. While making sacrifices, like downsizing your home or changing cars, can be difficult, setting up a new life that you can actually afford is key. Your goal with your divorce was likely happiness and freedom. Do your best to avoid unnecessary spending and going into debt. As your debt grows, your freedom may shrink, and you may feel as trapped as you did during your marriage. Financial stability will help boost your self confidence and ease your stress. You will look back years later and realize that the small sacrifices you made early on truly paid off.

4. Prepare to Provide for Yourself

Finding a job can be difficult, but is necessary for many recent divorcees. If you did not work during your marriage, the transition into the workforce is even harder. Having a solid salary to work with will make financial planning easier. Ideally, try to find a job that pays well and provides other benefits, such as health insurance. Many recently divorced people struggle with health insurance payments, as they previously relied on their spouse's plan. Having a job will also raise your self esteem and provide you with necessary social interaction. You may even make new friends and find yourself happier.

You will also want to pay attention to your credit score. A good credit score is a key piece of financial independence as a single person. If you did not work or open up your own lines of credit during your marriage, you may not have established an individual credit score. To find out where you stand, request a copy of your credit report. If you worked and maintained loans and lines of credit during your marriage, you likely will be in good standing. If not, be prepared to start establishing your credit. Start by opening a credit card, using it, and paying off the total balance each month. Maintain that practice, and you will notice your credit score rise. Having a good credit score will provide you with more future financial freedom.

5. Enjoy Your Life

Financial preparedness is a key part of your new life. Create and stick to your budget, and your financial stress will disappear. You will find yourself happier and much more confident. You should feel empowered by taking care of your life on your own. As you excel in your career and become even more financially stable, new things will open up for you. The pain of your divorce will eventually pass, and you will face a new world of possibilities.

In any divorce, having professional, quality help is key. A qualified Naperville, IL divorce attorney is available to assist you today. Contact the Pesce Law Group today at 630-352-2240 to schedule an initial consultation.

Sources:

http://www.entrepreneur.com/article/247785

http://www.forbes.com/sites/jefflanders/2012/07/25/seven-must-do-steps-for-women-who-want-financial-stability-post-divorce/