Divorces can leave a big mark on your finances, especially if you had not prepared a prenuptial agreement. Court fees, lawyer fees, and division of assets can leave your finances drained. However, you can get on your foot again with the help of a little planning.
Coping with money issues while you are still getting over your ex-spouse leaving you can be challenging. However, your life does not end after a divorce. Even though you are no longer a married person, you still have various responsibilities. If you need legal assistance, you can seek help from a divorce lawyer in Boston.
Tips to financially recover after a divorce
- Create a new budget.
If your divorce was high-end, you could not expect to enjoy the same things as before. Take a look at your savings, assets, and current income and draw up a new budget plan. Remember to save some room for your savings. If you cannot afford the maintenance of your current car, you may have to downsize to a smaller one. You may also need to move to a smaller apartment. A financial planner can help you create the perfect plan according to your spending patterns.
- Plan to repay the debt.
Divorces without prenup agreements leave you with debts, such as legal bills, credit card bills, etc. When creating your new budget, make sure you save enough money to repay your dues.
- Calculate your net worth.
After the divorce, you must calculate your net worth to get a clear picture of your financial status. Your net worth refers to the difference between your assets and your liabilities. Tracking your net worth every month can help you track your progress on reducing debt and saving for the future.
- Build credit in your name.
If you did not have any credit cards in your name until now, it is imperative that you start immediately. Developing a good credit score is essential for renting or buying homes and getting loans approved. To create a good credit history, get a card, use it to make payments, and pay the bill on time each month. If your former spouse is listen in any of your bank accounts, get their names removed as soon as possible.
- Build an emergency fund.
Divorce wipes out a significant portion of your money. Therefore, one of the important things to do is create a separate fund for emergencies. A good thumb rule to follow is keeping at least three to six months of your expenses in the fund. If you have inconsistent income, you may need to save more.
Rebuilding your financial life after a high-end divorce can seem challenging, but it is doable. Following the listed steps will put you in a much better place with your money and secure your future. If you are facing trouble regarding your finances in divorce, consult with an attorney today.