Preparing Financially for a Divorce
Many people are unprepared for the true cost of getting divorced. They usually factor in filing fees and attorneys’ fees, but divorce has other financial ramifications you need to be aware of. Put simply, living as a single person again is usually much more expensive than sharing a household with a partner. Unless you are leaving your marriage and moving in with someone, you need to take concrete steps to prepare yourself for the financial fallout. If you have questions, contact a Media divorce attorney to get started.
Estimate How Much it Costs to Live Alone
Once divorced, you cannot rely on a partner to help you defray living costs. This means you will be fully responsible for:
- Internet access
- Cell phones
- Post office box
- Trash removal
If you were on your spouse’s health insurance plan, you will now be responsible for getting your own insurance. Helpfully, people can buy policies on the Obamacare exchanges, but you need to research how much they cost. (Hint: they are expensive and usually have high deductibles.)
Also give thought to where you want to live. You might want the family home in the divorce, but you’ll end up being responsible for all maintenance costs. If there’s a mortgage, you’ll probably also need to take it over.
Of course, if you want to rent, you need to identify the prevailing market rate. You might be surprised that one-bedroom apartments are very expensive. Add up how much you think it will cost to support yourself.
Analyze if You make Enough
Some people relied heavily on their spouse’s income to pay bills. When you are single, you’ll need to live on your own income. Check if you make enough and prepare for getting a better paying job or a part-time job to make ends meet.
Don’t rely on receiving spousal support, either. A judge is not required to order it, or it might only be temporary. Ideally, you will make enough yourself to pay your bills.
Address Your Debt Load
In a divorce, a judge can assign marital debts to one spouse or divide them between spouses. Check to see how much debt you are likely to leave the marriage with. Debt takes away from other goals, like retirement, so you need a plan for paying off your debts as soon as possible. This might require creating a budget, something you might never have done before.
Revise Retirement Expectations
You might have contributed a large percentage of your salary to your 401(k) or IRA because your spouse was taking care of most of the day-to-day expenses. Once single, you might have little money left over each month to contribute to your retirement accounts. This means retirement could be delayed. You will need to meet with a financial planner to check whether you need to revise your expectations for when you can finally call it quits at work.
Contact a Media Divorce Attorney
Divorce has financial repercussions that many men and women do not adequately plan for. Ideally, you will plan for the costs of being single and have a game plan for how to support yourself going forward.
To discuss this or other divorce issues, contact Barbara Flum Stein & Associates today. We offer a free initial consultation.