Divorce brings many changes, and one of the biggest can be a change in financial status. Whether you are considering a divorce, in the process of a divorce, or if your divorce has been finalized, now is the right time to organize your post-divorce financial life.
Here are a few steps you can take.
Create a budget
It is important for all households to operate within a budget. For divorced individuals, a budget is even more important.
A budget could reveal that you have enough income to cover expenses. If income does not exceed expenses, however, then you will need to make changes. These could be relatively minor, such as brewing your coffee at home instead of going to Starbucks. But if your budget deficit is large, then things like moving into less-expensive housing might need to be considered.
If property and credit cards were in your ex’s name, then establishing your own credit should be a priority. A healthy credit score will enable you to obtain financing in the future from lending institutions. A simple way to build your score is to get a credit card in your name and pay off the balance every month.
Set specific financial goals
Focus on the practical, such as saving for retirement or establishing an emergency fund.
Adjust your tax withholding
After your divorce, you will be filing as a single taxpayer. This likely will change how much tax you will have to pay. The IRS has tools for estimating how much you should withhold from your paycheck.
Get help if you need it
Many Americans have little or no knowledge of how to manage personal finances. There is no shame in that. By seeking help from a financial counselor, you will be investing in knowledge that will be immensely useful both now and in years to come.
What should you do if you are thinking about divorce?
Filing for divorce can give you a fresh start and help you take control of your life. An experienced attorney can help you navigate the divorce process and emerge as a stronger, more independent person.