If you have never been through divorce it is one of the toughest things you can go through. Trying to relate to someone you once loved and now either hates your guts or you hate theirs… Not fun or easy. The temptation to be spiteful and cruel is strong. But today I’m not going to talk about that part of getting divorced. I’m going to talk about what I did to navigate the financial aspects successfully.
Get ready to take a financial hit if you are getting divorced
Getting divorced will not improve your financial situation. At least not right away. The best thing I did at the beginning when my husband and I split up is that I started my own bank accounts and managing all my money separately as soon as I moved out.
Getting separate finances right away will be super helpful as the divorce process, especially with kids, is not fast or simple. In my case I walked away from all the money in our joint account. I could have asked for it or otherwise tried to get it, but I didn’t. Only you can determine whether any shared accounts and the funds they hold are worth the fight.
It may not be hard at all to split up depending on your situation but it may be the thing that starts the real war. Tred carefully and realize that it may be worth some $ to avoid the stress of trying to split up those things. You can always come back to that later on in the divorce settlement.
Tip 1: Start using your own separate accounts ASAP. Separate out any money you can and be prepared to walk away from some $ if you have to
If you have kids and you are living separately while getting divorced
I cannot emphasize this one enough. As soon as you are living separately you should be filing for child support. Even if you are still married, if you are not sharing the same household you can start the child support process. It takes a while so not waiting is better. It can always be adjusted (and much more easily and swiftly) later when the divorce decree is done.
Resist the temptation to be a “nice” person here. It is not about being nice. It is about providing for your children. In the US there are state-run departments that manage this and I recommend strongly that you go through them. Each person submits their information and the formula used by the state spits out a number. It’s impersonal and cold – and that’s exactly what you want right now. It’s not YOU picking a number, it’s the court deciding with a formula.
In my state, they are required to have auto-deductions of any child support directly from their paychecks. If you have this option, do it. It creates consistency, the state keeps all the records and you don’t have to worry about exchanging funds with your former loved one.
Tip 2: File for child support as soon as you are living separately and do everything through a government agency.
Make use of all your resources when getting divorced
Now is the time to avail yourself of every possible resource you can. Your income likely took a big hit and you are trying to make due with less, meanwhile your bills probably look the same, or maybe even bigger.
This is the time that I learned what would become the second part of my Fairy Dust Method program, Optimize. First, if you don’t have all your bills written down in one place where you know what you owe then you NEED to get that organization part done. You can download the details budgeting guide for free below and there are step-by-step articles with more information at Start budgeting Successfully.
Tip 3: Get organized and then optimize all your expenses, income and get your resources in order
Now it’s time to Optimize!!
Next, I like to follow the thought process below:
- Can I eliminate this? If it’s a monthly bill the first thing you should do is eliminate it if you can. Get down to the bare minimum. If it’s a one-time bill call and ask if they can reduce it or if they have a program for forgiveness. Some monthly bills can be deferred for a period of time as well. I had my student loans deferred for one year so I could get on my feet and it saved me a bundle!
- If I can’t eliminate it, can I make it less? You probably can’t go without a phone but you can probably lower your data plan, or go straight-up old school and go back to a land line. You can lower insurance rates by raising your deductible for a period of time. Don’t forget to shop around for insurances either.
- Can I increase my take home income? See if your benefits at work qualify for an adjustment because of your life changes – sometimes you can choose new benefits when going through life events even when it’s not open enrollment. Get rid of that big tax refund but making sure you are only taking out enough money for the taxes you’ll need in your NEW tax situation. (If you are not sure what that is use the IRS tax withholding calculator).
- Do I have any other resources that I can use? You already know from my story about starting over that I am not against using federal assistance programs if you need them. See if you qualify for housing assistance, food stamps, and childcare resources.
Getting divorced – recordkeeping
One final tip. Record keeping is your friend! Get a cheap spiral notebook and track everything. Every call to your ex. Each time they don’t take the kiddos. Whenever you pay for something for those kiddos or a shared bill (and the receipt). You can do it. Information is everything!
When your attorney or the judge asks you a question, you won’t remember all the details. You’ve got a LOT going on. Take notes, write it down and carry that thing into battle with you. I swear, it’s a life saver!
Tip 4: Keep records of everything. You’ll refer to it a lot!
I just want to encourage you that it is totally possible to come out on top after getting a divorce. I’ve been through two and I am doing better financially than I ever was before. I am more stable, have more options and choices and feel more in control of the outcomes. All the things I thought I may never feel again when I was in the midst of my divorce.
If you know someone who would benefit from this post please share! We all know people in the midst of life stuff that can use practical encouragement and advice. Every single thing I offer up here is stuff I have successfully done and used in my life to get ahead with my finances and find financial peace.