Divorce can be a life-changing experience in more ways than one. Not only are the relationships and families impacted, but your finances, too! So, amid thorny divorce proceedings, how do you come out unscathed? How do you rebuild your financial life post divorce?
Luckily, help’s at hand! Here are five simple steps to rebuild your financial life post divorce.
#1 Planning the Course of Action
Creating financial security is easier said than done. But focusing on a financial planning course of action rather than worrying, can benefit you in multiple ways.
You will have to deal with many things now- post divorce proceedings, changing status, title change, setting up new bank accounts, changing nominees, and planning life with single income. You may even have to hunt for a new job, relocate, or find a new house or place of accommodation.
So plan the course of action. Divorce can be a means to an end. It is the start of a new life. Staying focused on what is positive helps.
#2 Take Stock of the Situation
To rebuild your financial life post divorce means to be proactive. Gathering information and doing research is an essential part of rebuilding the financial future. Take spreadsheets list down your incomes, savings, expenses, needs, assets as well as liabilities.
Huge financial costs may accrue post divorce proceedings, investment in a new house, or vehicle too. So you need to be clear about what you are spending and what you are bringing in.
Ensure you have a copy of all your financial records and all thoroughly checked. After all, you don’t want to be held liable for your ex-partner’s debts, do you?
#3 Budget for Life Beyond
The lifestyle you maintain also needs to be evaluated. Focus on how to prevent getting into debt, live from one pay check, penny pinching or being over-leveraged on a home.
You were lazy in preparing a monthly budget, but now you cannot afford without it. So make it a fun experience with technology. Plan a monthly budget for you considering all your expenses- rent, bills, children’s fee, grocery, loans, etc. This will give you a clear idea on how much you should earn and how much to curb.
It is never a good idea to get into some debt traps or living with a mounting up unpaid bills.
#4 Invest in your Future
Investing for the future is all the more important now. Plan investments for different life goals like buying a house, children, re-marriage and retirement. You can step out from the conventional investment plans and dare to take some risks, as you don’t have an option of spousal income for goals. A good financial planner can help you here.
Obtain life and health insurance to face any unforeseen situation or medical expenses. And don’t forget to apply for new credit or debit cards and investment accounts and remove your husband’s name from documents such as wills, retirement funds, healthcare plans, and life insurance policies.
#5 Embrace the Change
With divorce, financial doldrums can follow if you are facing an emotional breakdown. The first priority needs to be your financial planning, and when money is not an issue, you can move on to a better life.
Rely on Support from every possible sources – be it family or friends. It need not be a financial aid, but a helping hand, guidance, or even emotional support. Most importantly, wish your ex-spouse well. Separation need not automatically lead to hard feelings.
Divorce may be the end of a marriage, but it is the start of a new beginning. Women need to understand that the best part about a divorce is that their financial planning is now firmly in their own hands.