Divorce can impact many aspects of your life, including your finances, as a divorce lawyer in Bloomington, IL can attest. The loss of a second household income and legal fees can leave you financially strapped. You may struggle to pay some of your bills and worry about when you will finally have your financial situation under control. However, if you are willing to make some necessary changes, it is possible to improve your situation. Here are some tips for getting control of your finances after divorce:
Keep Track of Your Spending
To get your financial situation under control, you must start tracking everything you spend. Create a spreadsheet on your computer and write down every little item you spend money on, even that cup of coffee you buy every morning. This will help you learn where your money is going and what expenses you can cut out.
Find Out If You’re Entitled to Alimony Payments
Depending on the state you live in and your financial situation, you may be entitled for alimony payments. This is the monthly allowance you may be able to receive from your ex-spouse. These payments can go a long way in helping you pay your mortgage, utilities, food and other expenses.
Create a Budget
It’s important to create a budget and stick to it. Determine your monthly expenses and subtract them from your monthly income. If you don’t have much money leftover after all your bills are paid, you should think of expenses you can cut out. For example, consider getting rid of cable and your gym membership.
Put Together an Emergency Fund
Instead of spending extra money on eating out or trips to the salon, put it in an emergency fund. Ideally, you want to have at least six months of living expenses saved. That way, if your car breaks down or you have an unexpected medical bill, you’ll have the money to cover it.
Look at Your Credit Report
If you have joints accounts during your marriage, getting divorced can take a toll on your credit. It’s a good idea to check your credit report to see what you need to improve on. There are several ways you can start building up your credit in your own name, like paying all your bills on time and making more than the minimum payments on your credits cards. A financial advisor can give you even more suggestions on how to improve your credit rating.
Make a Long-Term Financial Plan
No matter what your current income is, it’s a wise idea to come up with a long-term financial plan. Determine where you want to be financially in a year, five years and 10 years from now and create a plan on how to get there. For example, you may want to get your mortgage paid off in the next 10 years. Getting a second job may help you reach that goal.
By following these tips, you can take hold of your finances after divorce and lead a more comfortable life.
Thanks to our friends and contributors from Pioletti & Pioletti for their insight into divorce law.