Divorce is troubling for many reasons, but financial concerns top the list. Too many people may remain in unfulfilling — at best — or toxic marriages, or be tempted to stay for fear of the financial consequences of going it alone.
If you’re the partner who lets your spouse handle all money matters, divorce — and the financial independence that it brings — can be especially scary.
It can be difficult to get by on one income after you’re used to being half of a two-income partnership. Or if you were a stay-at-home parent and suddenly find you need to get back into the job market, that’s a challenge too. But none of these scenarios are insurmountable. All you need to know is a few things, and you’re ready to celebrate your financial independence.
1. Create a new budget
Get a good overview of what your monthly financial picture looks like. What’s coming in with you? What do you have to pay out? If your new financial reality has more expenses than income, determine where you can save.
2. Find out what you can let go of
Maybe you don’t need the Country Club membership. Some clubs allow you to temporarily suspend your membership. You can’t use the golf course or swimming pool, but you don’t pay expensive monthly fees either. A country club membership is an obvious “nice to have” that you might be able to let go of – at least for a while.
You can decide that you don’t have to send the kids to a private school that costs $50,000 a year. While this is an option for people with good public schools in their area, it’s admittedly not for everyone. If private school is a must for your kids, you should speak to the school’s tax office about a payment plan until you’re back on your feet. Or a scholarship would be an option.
If you are funding a child’s college education, look for financial assistance. Or consider talking to your child about a work/study program or student loan.
Other things you might be able to let go of: the expensive mortgage. (Consider downsizing.) Chic (and expensive) vacations. Instead, a stay where you become a tourist in your own city is an alternative. A series of day trips to interesting attractions close to home might not be Disney World, but they can be insightful, entertaining… and budget-friendly.
3. Recognize that a divorce, even an amicable one, sucks
Take time to mourn the loss of your marriage. Process the loss. Then it will be easier for you to continue.
A friend recently made an offer on a house that she really wanted. The house and its yard really suited the new life she envisioned and hoped to achieve. She had even envisioned her dogs enjoying the fenced, landscaped backyard. Unfortunately she was outbid for the house. She told me she was mourning the loss of this home and the life she believed it would offer him.
Everyone The loss needs to be acknowledged and felt. Only then can we get on with the business of life.
4. Give yourself the recognition you deserve
The death of a loved one and divorce are two of the worst parts of life we can endure. If you’re going through a divorce and still manage to work, raise your children, and participate in life, give yourself a pat on the back. You are surviving a traumatic time. Life will be good again, but this is a tough time. Be gentle with yourself.
Part of gaining recognition for yourself is maintaining your integrity during a potentially brutal process. Imagine the life you want when all of this is over. (And it will be over.) Hold on to your dignity and self-respect. stop right now she.
5. Speaking of credit, make a plan to rebuild your own credit
A first step is to resolve joint debts with your separated spouse. Find out who is paying for what. close accounts. Make sure you don’t miss payments on joint credit cards. This will help your credit score take a nose dive.
Indeed, never miss a payment on your bills – cell phone, utilities, insurance. Paying your bills on time is the most important thing you can do to protect your credit score.
If you don’t have your own credit history, now is the time to start creating one. Let’s say you were an “authorized user” on your ex’s credit card. You need to remove your name from that line of credit, and you need a card — and credit history — in your own name. Look for a credit card with no annual fee and one that offers 1% or 2% cashback on purchases.
Try to keep your credit consumption to a minimum. After payment history, credit utilization — the percentage of total credit you use — is the most important factor in determining your credit score. Experts recommend keeping credit utilization below 30%.
Don’t let personal financial worries stop you from living your best life – married or not. That’s what financial independence is all about.
Founder, GraserSmith, PLLC
Tonya Graser Smith is a family law attorney, licensed attorney in North Carolina and founder of GraserSmith, PLLC in Charlotte, NC Legal Affairs.