If you’re going through divorce, it’s normal to feel worried about your finances and your financial future. Having a financial plan in place can help you reduce the stress associated with divorce and it's key to being prepared as you negotiate your divorce. In this blog post, we’ll cover the basics of creating a financial plan for your post-divorce life, including budgeting, saving, and preparing for retirement.
Creating a Budget
A budget is the foundation of your financial plan. In order to create a budget, you must first compile the last 3 years of your bank and credit card statements. You also need to have information about all of your assets and debts. As you understand your monthly income and expenses in the past and how they will change going forward, you can make sure that you have enough money each month to support yourself and your children’s needs. Create a list of all your income and expense including:
Saving for the Future
It’s important to save for emergencies and retirement, even after divorce. An emergency fund should have enough money to cover three to six months of living expenses in case of an unexpected event. Start by setting aside a small amount each month to put into your emergency fund. You can also start saving for retirement as soon as possible. Consider opening an IRA or other retirement savings account and contributing regularly.
Hiring a team of professionals
Divorce professionals can help you in many different ways and are an important part of successfully getting through your divorce process. A financial professional can help you prepare a budget and create a plan for your financial future. A divorce coach can help you efficiently use your other divorce professionals which can save you money. Divorce coaches can also help you determine your priorities which can save you time that you would have spent fighting for things that aren’t important to you. Divorce attorneys can be used as consultants to answer your legal financial questions. Other professionals that you may need include a realtor, mortgage broker, and an accountant.
Creating a financial plan after divorce can help you take control of your finances and ensure you’re prepared for the future. Start by creating a budget and tracking your income and expenses. Next, save for retirement and an emergency fund and make sure that you hire a team of divorce professionals to support you as you go through your divorce process. With a solid financial plan in place, you can feel confident that you’re doing what you need to do to protect your and your children’s financial future.
Jill Barnett Kaufman is a Divorce Coach, Therapist, Parent Educator and Divorce Mediator. She is an experienced professional who helps clients discover new ways to resolve a variety of challenges when considering divorce, starting the process of divorce or are already divorced.