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Getting Finances in Order After a Divorce

Getting Finances in Order After a Divorce

| January 10, 2024

Divorce can be one of the most stressful events of your life, whether you filed or your ex-spouse served you. It’s an emotional time and can require a significant shift in your lifestyle and daily routine. One of those shifts involves your finances. 

Before your divorce, you might not have been the one who paid the utility bills, car loans, or taxes. You might also have alimony and child support payments going forward. Regardless of your previous responsibilities, you will need to focus on becoming the financial manager of your household to keep your life and goals moving forward. 

As a newly single person, adjusting your attitude toward your money can help you recalibrate your lifestyle for your single income. Follow these steps to get your finances in order after your divorce. 

Put Together a Team 

Developing and maintaining a positive mindset is essential to getting and keeping your financial future on track. This is why one of the first steps you will need to take for your finances after divorce is to put together your own personal support group. 

This group may include a relative, close friends, and a trusted counselor — as well as certain professionals, such as a divorce attorney, insurance broker, and financial planner. These professionals can provide solid advice about legal and financial matters and insurance needs. 

Together, your team can give you the valuable insight and support you need to move forward. 

Make a Plan 

Divorce can leave you in debt and dealing with new financial challenges. Developing a plan for these challenges is a key way to keep your finances in check after divorce. 

Start by collecting all of your financial records, including: 

  • Checking and savings accounts 
  • Real estate information 
  • Tax filings 
  • Your will 
  • Investment and retirement accounts 

You can then create a list of your debts and how you might pay each of them off, update your insurance and beneficiaries, and check your credit report to see where you and your ex-spouse are still connected financially and legally. 

With a clear picture of where you are and a roadmap for the days ahead, you’ll have a much better chance of reaching your financial goals following a divorce. 

Build a Budget 

With a team behind you and a plan in hand, you can build a budget that adjusts your new lifestyle to your single income. List your income sources and your bills, making sure the bottom line comes out to zero. 

As someone fresh off a divorce, building a budget that accounts for the new changes in your life can be particularly challenging. This is one reason creating a support group is one of the first steps toward getting your finances in order.  

Your support team should have your best interests at heart, and with their good personal, spiritual, legal, and financial advice, you will have the ability to make the changes in your lifestyle you need to secure the financial future you want. 

Create an Emergency Fund 

If you had an emergency fund before your divorce, you may be using it during this transition period and need to replenish it. If you didn’t have an emergency fund before your divorce, now is definitely the time to create one. 

Many experts say you should put away enough money to cover three to six months of your living expenses. But starting is the key, and working toward getting your first $1,000 squirreled away is a good goal. 

Increase Your Income 

You also may decide that you need more income to cover your single lifestyle. Find a side gig, ask for a raise at your current job, or look for a higher-paying job. Some people might not want to deal with another change in their life, but a change in the workplace might lead you to a better financial outcome than you expect. 

The additional income — whether from a side gig, higher salary, or new job — can give you the boost you need to secure your finances. 

A Skilled Financial Advisor Is Crucial 

Getting your finances in order after a divorce can feel overwhelming. Your finances are likely only one part of your life that will be changing and requiring your attention. This is why a trusted financial professional can be a valuable asset to your support team.  

At Good Life Financial Advisors of Morehead City, we are committed to helping you and your family achieve your financial goals. Contact us to schedule a no-obligation discovery meeting to discuss your current and future needs today.