Moving Your Finances Forward After a Divorce
Divorce can acutely impact your financial life, but there are proactive steps you can take to rebuild your finances. A few of the steps you should prioritize including adjusting your household budget to fit your individual finances and consider how divorce changes your health insurance and taxes.
Once you have a handle on your personal finances, you can set new goals for your financial life. Planning a new life is part of processing and healing during the divorce and moving forward once the divorce has been finalized. If you are navigating a divorce, connect with a skilled Bucks County family attorney to secure your future.
Your Budget and Debts
There can be large shifts in a household budget when a union ends. After all, even high earners feel the pinch when one household shares two high incomes and earnings are then halved, or more than halved. The amount of discretionary spending may have to be adjusted. Instead of resisting the new budget, be honest and shift spending habits right away. If you need to downsize your home or vehicle, doing so as soon as possible will allow you to regain a feeling of control. Living beyond your means can be stressful.
If there are debts you need to pay off, include extra payments to the debt in your budget. When it is possible to give up extras for a short period of time, it can go toward interest on debt. Once the debt is paid off, you can celebrate knowing the amount of interest paid was reduced, plus you can work extras into your budget again.
When the combination of a tight budget and looming debts is overwhelming, consider ways to access additional funds. For example, there may be a side project that could create another stream of income. Any additional income can help when a household budget needs a cushion.
Health Insurance and Taxes
In order to avoid any unexpected payments at tax time, individuals should talk to their employer or an HR representative at their workplace to adjust their withholding status. Plus, you may want to adjust your healthcare insurance. If your former spouse was covered on your employment health insurance plan, have them removed from the plan. And if you were on your former spouse’s plan, discuss coverage options with your employer or explore purchasing health insurance on the marketplace.
Adapting to a new financial climate can be difficult, but there is help available. Some find working with a financial planner helpful. After looking through your accounts they may identify an option you hadn’t considered on your own. Also, when navigating the divorce process, a Bucks County family attorney will work to obtain spousal maintenance payments and child support payments when possible.
Do you have questions about how a divorce will change your financial future? The family law attorneys at Kardos, Rickles & Hand can help. Our dedicated legal team understands the finer points of family law. There are opportunities to create the life you want. Schedule your consultation today, call 215-968-6602.