The grim reality of post-divorce life can be difficult. Here are some dos and don’ts for handling finances after the divorce.
- Create a post-divorce financial plan. Now is not the time to stop thinking about finances, it’s probably the most important time to consider them. Often, divorce means a change in lifestyle, as the means for supporting the old one is no longer feasible. You may earn less income, or for some women who were stay at home moms, there is no income at all. Spousal support and child support usually don’t equal enough to support a family in the style they were accustomed to. Many husbands and fathers will take a huge hit in their income to adequately support either an ex-spouse or their children. In both cases, you need to assess your new life, your budget, and adjust accordingly.
- Learn how to handle money. If you weren’t the money-manager before the divorce, you may find this a challenge. There is no one to keep you on budget. Your finances are in your own hands now. Sometimes there are low cost, community classes that teach budgeting skills or similar financial workshops. Ask your tax preparer or an accounting professional if they know of any courses that might help you. Online courses are another option.
- Make sure all the assets and debts you got in the divorce have all the correct information on them. Set up new accounts and make sure any old ones from your marriage are closed.
- Own real estate jointly, it can be a bad idea. Take the necessary steps to separate all property.
- Allow sentiment or love for an ex-spouse cloud your judgment. Be cautious in all transactions with the ex. Look out for yourself and keep an eye on your credit report; they know enough about you, such as your social security number, birth date, mother’s maiden name, etc., to get new credit cards or take out a loan.
- Make any big financial decisions or purchases fresh off a divorce. This may not be the best time to make sound choices. Wait six months, even a year. Give yourself time to recoup from the emotional turmoil of divorce, to mourn the loss, and to find your way in your new life.
By taking a few steps to understand your finances, you can ensure your transition from a married life to a single one can be a smooth one. Change can be disruptive and stressful, but viewed in a positive light, it can also be motivating and exhilarating. Be in control of your finances and thus, your new life.