Divorce affects multiple areas of the couple’s life, including emotional and physical health, living conditions, and finances. The blow to financial stability is one that can seem impossible to rebound. Allow us to suggest a few tips that may lighten the burden.
Examine Your Situation
The first step to improving a divorcee’s situation is understanding it inside and out. An excellent place to start is reviewing bank statements, tax returns, and retirement statements. These statements should help determine exactly how many resources you have available. It is also recommended that you close any joint accounts you have with your now ex-spouse to ensure you are the only one that has access to your money.
Create/Update Your Budget
Separation is a topic that most couples are familiar with; however, it becomes a different game once you are divorced. The idea behind having a budget is to ensure your financial resources will be able to support your new lifestyle. Your account should also be detailed enough, so you avoid having any surprise expenses later on. On a basic level, a budget is a list of costs (monthly or seasonal) including but not limited to mortgage, home repairs, retirement and investments, child care, school/ college savings, insurance (health, audio, property, and disability). Though this may take some time to set up, it is the easiest way to help you stabilize your finances.
Build Your Credit
Many couples have joint credit. If this was your case, then after the divorce, you will need to build your credit history in your name. To rebuild your credit, you must keep your usage below 30% of the limit and pay on time. It is also important to have multiple credit lines open to show that you are a trustworthy steward of the credit. Credit will be one of the most useful tools on your journey to financial stability after your divorce.
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