After divorce, managing your money can become very tricky. You may be used to living on what you and your spouse made as your combined income, which was very likely higher than your own individual income. You may be paying alimony or child support, which cuts your take-home pay in half. You may suddenly find yourself having to manage money for the first time in years since your spouse was taking care of everything until you split up. So, if you find yourself in any of these situations after divorce, what should you do?
Tips for Managing Money After Divorce
After divorce, you need to take stock of your financial situation right away and get a handle on how to manage your money. Following the divorce, this means there are several key things you should do:
- Take stock of your financial situation. What is your income, and what is your outgo. Do you make more than you need to spend to continue living your lifestyle? If not, then you need to make some drastic changes- sell the house or a car, get a better job or otherwise fix the imbalance so you don't end up in debt.
- Make a budget. You may have to be more careful with your money, so you now need to know where it goes. You may also need to deal with lingering debts from the divorce, and the fact that you are now 100 percent responsible for funding your own savings and retirement accounts without the help of a spouse. All this needs to be factored into your budget.
- Get credit and insurance in your own name. If you had only joint accounts or were covered by your spouse's policies, its time to get these things for yourself. You may need to start with a small credit line, or even a secured card, if you have never had your own credit before... but the sooner you start, the better off you will be and the sooner you can establish a strong credit profile in your name.
Getting Help
One tip that is essential to managing money after divorce is making sure you have money to manage. This is why it is very important to find the right divorce attorney to help you throughout the process of getting a divorce. Your divorce attorney can assist you in making sure the divorce settlement is fair and that you get the property, alimony and child support that you deserve under the laws of your state.
