You May Lose Income
If you are not the main income-earner in your marriage, you will lose income when you go through a divorce. Those who are accustomed to their spouse’s income in addition to their own may find that this is difficult to adjust to and may have trouble making the financial changes necessary to support themselves on one income. Because of this, certain situations allow for spousal support — a portion of income from the main income-earner to make things more equal — which can help you get to a more stable point where you can support yourself on one income.
Whether you receive spousal support or not, you will likely not have as much income as you did when you were married. Make sure that you are prepared for this and spend time working with a professional who can help you create a financial plan for this loss of income.
Things Could Seem More Expensive
If you’re used to splitting the cost with your spouse, everything may start to seem more expensive. When your income is pooled, the percentage that you spend on things like household goods, utilities, and other necessities is smaller than when you only have one income. As a divorced person, you will need to become accustomed to only having one income and the subsequent higher percentage that things may cost. It’s a good idea to plan for any upcoming expenses and to make sure that you have plenty of money saved in the event of an emergency. These could both safeguard against financial disaster if you have to purchase a truly expensive item.
Your Debt May Increase
Debt is almost always included in divorce agreements. If you have shared debt, you will work out who becomes responsible for that debt during divorce. Because of this, you may find that your debt increases. While this not only complicates things in that you will become responsible for paying debt down, but it also creates complications in that it could impact your credit score. When your debt is no longer a shared responsibility, you will need to make sure that you are practicing good financial habits to prevent the debt from hurting your credit.
You’ll be Financially Recovering
Divorce is expensive. Whether the divorce was a drawn-out and complicated process or it was a simple agreement that you worked on together, you’ll still need to pay fees. Additionally, you could get behind on things while you’re going through the divorce, and you’ll likely find yourself with a slew of new financial responsibilities after the divorce. After your divorce, you will be in a state where you’re financially recovering. This is a key point in your financial future and something that you will need to manage wisely to ensure you do not set yourself up for failure. Keep your budget tight. Avoid unnecessary expenses. And stay on top of your finances at all time. While you’re in this state of recovery, you have the opportunity to set yourself up for a much better financial future.
Finances Will Become Your Responsibility
If your spouse was the person who typically handled the finances — including debt, income, and bills — you’ll need to take on these new responsibilities. On the other hand, if you were the person who was primarily responsible in the past, you may find that it’s easier to manage finances on your own without the input of another party. Either way, it’s important to adjust your mindset to this new way of budgeting and managing your finances after divorce. If you are prepared for your new financial responsibilities, it may be easier for you to tackle them.
Finances are one of the biggest parts of divorce and often where divorcing couples run into major problems. While you are going through a divorce, make sure that you are financially prepared to come out of the divorce and begin your new life. Work with a certified divorce financial anaylst to help you achieve your divorce finance goals.