Successfully Navigate through this Transition

There’s no doubt about it – going through a divorce can be an emotionally trying time. Ironing out a divorce settlement, attending various court hearings, and dealing with competing attorneys can all weigh heavily on the parties involved. Stress can cause regress. And regress can compromise one’s decision-making and lead to regrets. In addition to the emotional impact a divorce can have, it’s important to be aware of how your financial position will be impacted. You’ll want to put off as many financial decisions as you can until the time that you are feeling that you’ve regained your sense of self. Unfortunately, some decisions are necessary, and making sure that you can pay your monthly bills is one of the most urgent. A good place to start is to establish a budget that reflects your current monthly income and expenses.

Assess your current cash flow situation

Prior to the divorce, you’ll need to assess your inflows, taking into account the likely loss of your former spouse’s income. In addition to your regular salary and wages, be sure to include other types of income, such as dividends and interest. If you will be receiving alimony and/or child support, you’ll want to include those payments as well. You may now be responsible for paying for expenses that you were once able to share with your former spouses, such as housing, utilities, and car loans. Divide your expenses into two categories: fixed and discretionary. Fixed expenses include things like housing, food, and transportation. Discretionary expenses include things like entertainment, vacations, etc. Keep in mind that you may need to cut back on some of your discretionary expenses until you adjust to living on less income. Ultimately, you may come to the realization that you’re no longer able to live the lifestyle you were accustomed to before your divorce. However, during this difficult time, it’s important not to deprive yourself entirely of any enjoyment. You’ll want to build the occasional reward (i.e. yoga class, dinner with friends, etc.) into your budget.

Consult a Financial Transitionist™

Although it can certainly be done on your own, you may want to consider consulting a financial professional trained in life transitions to assist you in adjusting to your new financial life. In addition to helping you assess your needs, a Financial Transitionist™ trained by the Sudden Money Institute can work with you to seamlessly integrate the external (financial) with the internal (emotional) for decision-making with fewer regrets. Not only do you need a plan for your financial goals, but you also need to plan to manage the change. Is your own financial future secure? Do you have friends or loved ones going through transition events such as a change of career, divorce, widowhood, remarriage, and/or retirement? If so, please put them in touch with me – let me help them ensure their future financial success.

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