Maintaining your mental and emotional health after the divorce is hard enough, but taking control of your finances can relieve stress.
After the divorce, you can have a significant impact on your finances. Emotionally, it can destroy your self-esteem and belief in what your life may be like in the future. Regardless of the reasons for the breakup, the effects can linger for a long time. If your divorce has been particularly controversial, you may have a long way to go in order to recover. One thing that you can control relatively quickly is your financial situation. After the property, debt, and fortune have been divided, it is time to begin putting yourself on good financial terms. Take a closer look at these five things you can do to improve your finances after divorce and prepare for future financial success.
Tips to Improve Your Finances After Divorce
Create a monthly budget
It may not have been required for your combined income during your marriage draw up a budget. Now that you are a household with an income it should get used to. A budget should not intimidate or shame, but help. This will give you a clear picture of how much money you are making and where to go. Start by listing all of your household bills. This includes things like:
- Mortgage or rent
- electricity
- gas
- water
- Property insurance
After completing this, move on to your monthly debt payments. these can include a car loan, Credit card and student loan. The final step is to factor in groceries, housewares, and other monthly expenses. These may not be easy to figure out at first, but after a few months you will get a better idea of how much they will cost.
Money makes the world go round
Paying with credit is usually easy. So you can get what you want without having to wait and save. However, to get back on your feet after a divorce, it is best to stop buying large items with credit. There are exceptions, of course, but usually use cash when possible. If you save money to buy a couch for a few months it might take forever, but it will save you money later.
Set up your Solo Balance
There are times when it is not possible to use cash. When buying something big like a car, you need to have credit. Getting a vehicle on your behalf alone can prove difficult after a divorce as it is likely that you will not have such a high individual credit score. When you set up your balance, you may just need to open and use new credit cards on your behalf. This is not a license to charge freely, it is an exercise in restraint. Get a card that you can use to top up your utilities every month, but pay them off in the end. It’s true that credit bureaus want you to have credit on credit cards, but it doesn’t have to be exorbitant.
Sell what you don’t need
You may have emerged from marriage with items that used to mean something but now take up space or evoke sour memories. Selling used goods is much easier than it used to be because online websites are available to complete the transaction. Outlets have been set up on social media where neighborhoods can create buy and sell pages. If you want to sell more high-end items like jewelry, you should speak to a reputable jeweler in your area. A jeweler can give you a rating or a report on how much your pieces are worth. In some cases they can make you an offer on site. Selling what you no longer want is a great way to save money too.
Make extra money
What if your monthly bills outweigh your income? This may be a hard pill to swallow, but it’s not uncommon to feel the pressure of too little money after a divorce. The most damaging path you can take is to make a living on credit. Instead, cut your budget where possible. If you still run into a deficit after that, you may want to find a second job. Don’t take on a second full-time job unless it suits your lifestyle. However, something you do in the evening or when your kids are away can give you the boost in your bank account you need. Even if you don’t have a large deficit, getting extra cash from a part-time job is never bad.
Getting your finances in a good place after the divorce can take time and patience. There may be setbacks along the way, but you will get there if you keep going. Give yourself some grace during the process. Remember that you are still being healed from a life changing event. You need to show yourself a little brevity if you’re trying to get back on your feet.
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