Divorces are hard for many reasons. They are a complex end to a marriage. They are also business transactions that involve assets, including money. Money is the biggest issue that couples fight over in a divorce, and for good reason. Many people are left high and dry following the end of their marriage.
In a marriage where a lot of wealth is involved, it is possible for both parties to come out of a divorce with millions of dollars in assets. However, this is not the norm. It is more likely that you will be left with a lot less money than you expected.
Because of this, you should not expect to maintain your lifestyle after a divorce. Whether you were the primary wage earner, you stayed home, or you both shared equal financial responsibility, a divorce will have some sort of an impact on your finances.
A divorce is a life-changing event, and if you are near retirement, you are especially going to have a lot of problems. Here are some things you should know about your finances and lifestyle after a divorce.
What Lifestyle are You Accustomed to?
While the courts strive to help divorcing couples maintain their lifestyle, sometimes it is not possible. The marital standard of living is an important factor, though, and it can help determine property division and alimony so that both parties can continue a similar way of life after the divorce. Alimony is often seen as a bad word, but it does not have to be permanent. It can be used for a limited period of time to help one party get the education or training needed to work and support themselves.
Florida is a fair and equitable state, so the court can divide assets in a way that will benefit both spouses. For example, a person could be given more property in lieu of alimony.
Assess Your Current Situation
Take stock of all your resources. Assess your assets and liabilities to see where you stand. Also keep in mind monthly expenses so you can create a budget.
You may be leaning toward keeping the marital home, especially for sentimental reasons. However, living in the family home on your own can be problematic in several ways. The biggest issue is the expense involved. Not only do you have to cough up the money for the mortgage every month, but there are also insurance, taxes, and maintenance expenses to keep in mind. Because of this, it is a good idea to sell the home and downsize. You can rent for a while and save up money for a smaller home of your own. Also, selling the home will give you the money you need for retirement.
Think About Your Future
Speaking of retirement, that is something you will need to think about as well, whether you are in your 50s, 40s, or even your 30s. Planning for retirement is not an easy task, so this is something you will need to figure out either on your own or with help from a financial planner. You will not have the benefit of your spouse helping you out, so you need to be proactive. Start taking the appropriate steps now so you have a plan and goal in mind. Do some research to figure out how much money you will need and how you will amass it.
But retirement should not be your only goal. When setting financial goals, think about what you want your life to be like in one, five, or 10 years. This will give you something to look forward to, which will give you motivation to save up money to meet these goals.
Pay off Debt
Whether you have a mortgage, student loans, personal loans, or credit card debt, debt is something that plagues nearly everyone. Debt will linger until you pay it off. By then, you could accumulate hundreds of dollars in interest fees. So agree to a plan to get your debt paid off quickly. You could start with the smallest debt first and get that paid off. Then work on the next smallest debt until all your debts are paid off. It will not happen overnight, but if you are motivated enough, you can get your debt paid off quickly so you can use your money for more important things.
Reduce Expenses
Living on one income instead of two will be a real eye-opener for you after a divorce. You will quickly find that your income does not go as far as it used to. Having a budget can help you see where your money goes and how you can cut back. Look at expenses such as utility bills, shopping, food, and entertainment expenses, and see how you can reduce them.
Use coupons and sales to save money on food. Look at cable TV usage and cut back on subscriptions. You probably do not need Amazon, Hulu, and three other subscriptions, so choose one that fits your needs. You can save on utility bills by not overusing your heater or air conditioner.
Seek Legal Help
Things are not going to be easy after a divorce, especially financially. You are not going to get everything you need, so you need to accept that. Do not expect a comfortable lifestyle after your marriage ends.
Broward County divorce attorney Scott J. Stadler can give you advice about the financial aspects of divorce. Let us help you with post-divorce issues. Call (954) 346-6464 or fill out the online form to schedule a consultation.