Let’s face it: divorce causes a ton of emotional upheaval. On top of that, you have to navigate the complex financial separation that makes up the bulk of a divorce. It is important to keep your head about you while negotiating and agreeing on your future finances, and that is hard to do when you are flooded with emotion. Keeping your emotions out of the equation and reframing the way you think about this part of your divorce can be a tremendous help. Thinking of it as a business transaction will help your brain stay calm and focused so that you can make good decisions for yourself and your kids about your future.
The other big stressor: your house. Maybe it is the place where you raised your kids. Maybe it pulls at your heartstrings a bit to think about moving from there. Also consider that you might not be able to afford your house. Maybe you will be financially better off if you moved somewhere else, [provided custody and parenting agreements allow for it], freeing yourself from that responsibility and being able to truly move on with your life.
Once you are over those two HUGE hurdles, here are some action steps you can take.
> Look closely at your finances and determine where you can cut back and reduce expenses. Maybe you notice you eat out three times a week, or spend a lot on online shopping. Looking at your past bank statements, see if you notice a pattern of spending. Examine each item and determine whether it was a ‘must’ or not. If it wasn’t, check in with yourself to see if you regret the purchase or could have done without it. Cut back on that type or purchase and try to be mindful going forward. Figure out what you can [and have to] live without, and stop spending on those items.
Additionally, find ways to lower the bills for the things you do need–see if there’s a long-time customer discount at your electric company, or a better phone plan. Finding ways to take small amounts off of many bills can certainly add up to a lot of savings.
>Create a new budget based on what you are receiving in terms of income from your job, child support, and spousal support. Be reasonable about allocating funds and prioritize as much as possible. There are a lot of great budgeting apps and websites out there. Find the one that works for you that you will stick with and make it happen!
>Pay off debt as soon as possible. There are many techniques for getting this done efficiently and quickly. The ‘snowball’ method is one in which you pay off the smallest debts first, then when those are paid, you add what you were paying for that one to the next lowest one, and so on. Nerdwallet.com has a great tool for you to use to do this. Of course, use the method with which you will be the most successful.
>Get a credit card in your name and [re]build your credit. Look for low interest rates and deals that fit your lifestyle. Maybe you buy groceries & gas only with your card–look for a card that offers cash back on those purchases. Making monthly payments on time is super important. Next, monitor your credit score. There are many websites that will show you your credit score for free, without it affecting your credit. Check in every so often to make sure you are on track.
>Start up a savings account for emergencies. This account should equal between three and six months of expenses in case of emergency. Do not touch this money unless you have a TRUE emergency, like a car or home repair or medical issue. You will be glad you have it if you need it.
>Set some financial goals for yourself. Want to go on vacation, or buy a new car, or piece of furniture? Save up! Create a separate savings account for you to use to save up for things that are wants, not needs. Commit to putting a certain dollar amount in every time you receive money, no matter how small. Reaching your goal and going on that long-awaited vacation feels really great. Trust me, I know.
>Find some ways to make a little extra money. Side hustle, anyone? You can make a little extra on the side and give yourself a bit of a cushion on your budget. Part time work, if it works with your schedule, can be a great way to earn more money. Also, think about applying for higher paying jobs in your field, or asking for a raise or promotion at your current job. Be creative!
>Plan for your future. You may already have a 401K or other retirement account from your marriage. Now that you are single, don’t neglect the future planning you will need. Seek out a good broker or financial advisor for your investments and make a plan with them for moving forward
Finances are one of the most stressful aspects of divorce. Getting a handle on it might seem really scary right now, but with time and effort, you will feel powerful and empowered in this part of your life–and you will be one step closer to creating the life you deserve!
Are you ready to feel joy again, reclaim your independence, and chart a path toward healing and recovery? I would love to help you as you take those steps. Check out my guide on 7 Ways to Rebuild Your Confidence During Divorce, with real, practical tips on how to start taking control of your story and create the life you have been dreaming about!