Divorce means starting a new life, and that includes building financial responsibility and independence. Many new divorcees will have to deal extensively with finances for the first time in years or perhaps their entire lives. These steps will help ensure a smooth transition in your financial life.
Speak with your lawyer.
This assumes you hired a divorce attorney – which is highly recommended. Although a divorce lawyer’s primary job is to assist with the divorce itself, they have an interest in seeing their clients succeed post-divorce as well. Your family law attorney is likely to have a number of good suggestions, from expanding on the tips in this article to referring you to professionals, organizations, or support groups to help you along. Even if your divorce is already finalized, your lawyer will probably be happy to spend a few minutes giving you some advice.
Make a budget.
Your divorce probably caused significant changes to your cash flow and responsibilities. Now is the time to remake a proper budget from the ground up. Evaluate your income sources and try to anticipate an entire month’s living expenses. Then maintain a record of all income and expenses and re-evaluate your budget periodically. Is your financial path sustainable? If you are going into debt, what expenses are you able to trim? If you are able to save, are you setting aside that money in order to avoid the temptation to overspend?
Depending on your asset levels, you may wish to speak with a financial planner or accountant for help protecting your wealth.
Update estate plans.
Your spouse was likely named as the beneficiary for your insurance and investment accounts. Make a list of all accounts that need to be checked and change them as necessary. If you have a will, make an appointment with your attorney to review it and any other legal documents involving your ex.
Reassess your insurance coverage.
If your health insurance came from your spouse’s employer, you will need to find your own coverage soon. If you are unemployed or your employer does not offer health insurance, look into purchasing COBRA insurance through your ex-spouse’s insurer. COBRA provides for temporary continuation of group benefits.
You may have a greater need for long-term care insurance following your divorce. If you anticipated your spouse being able to care for you in the event that you needed long-term care, you may have to reevaluate.
In all your dealings with money, exercise caution and seek expert advice when you need it. With a little effort and planning, your post-divorce financial life can be secure and rewarding.