submitted by Sharon Brewer
Depending on the circumstances of the relationship, a divorce can be a financial fiasco. Even if your month-to-month doesn’t really change, you now have the added responsibility of managing your finances without a second opinion. In the immediate aftermath, this can feel overwhelming. Thankfully, there are steps you can take to be confident in your newfound financial autonomy.
Evaluate Your Situation
While you may have reviewed your assets during the divorce, you must also consider the affect it has on your income. Your first step should be determining if your bank account is increasing or decreasing month over month. If decreasing, then expenses need to shrink or income needs to grow. This principle, while obvious, is an easy way to reduce financial uncertainty in the short-term.
Prioritize Financial Peace
Having taken the first step toward financial confidence, review your personal balance sheet and look to improve. If you don’t have an emergency fund that can support you for at least 3 months, start saving. If you already have a 3 to 6 month savings account, pay off any debt before increasing your retirement savings. By working towards one goal at a time, you can focus your pursuit of financial freedom, building confidence every step of the way.
A divorce isn’t the end of your journey to a bigger, better future. The destination may have changed, but that doesn’t mean you should sacrifice your ambitions. With the security of a monthly income and the momentum from accomplishing your goal, begin to imagine what financial freedom could look like for you. Then, make a plan and get to work.
Whatever your financial status after a divorce, the pursuit of financial confidence will yield lifelong returns. However, progress can seem impossible if you don’t have a strong support system. So whether you lean on family, seek the counsel of good friends or schedule a meeting with one of our advisors, find the people who will you cheer you on as you work to achieve your bigger, better future.