Divorce, How Are Finances Affected?

Divorce creates financial hardship for both spouses.  Some may believe the myth that the person with custody of the children becomes destitute, but the reality of divorce and separation is that both spouses and children suffer.  Let’s face it, the same money used to support one household is now being split between two households.  So unless, someone is going to make a lot more money after the divorce, then everyone is suffering financially.

This is where we need to problem solve and belts may have to be tightened.  Instead of steak nightly, maybe there are only 2 or 3 days a week of steak.  Eating out may have to be reduced.  Expenses such as lawn care, cable bills and other items that were a staple in the household will have to be reviewed and if not essential, then cut.

The finances are almost always where the conflicts arise.  People usually get very emotional about money.  The first step is to do a future budget.  Here’s how to get started:

  • List out all of the things that you are paying today with the amounts and frequency
  • Prioritize these items, making things essential and labeling them #1.  Sorry, but the country club membership should not be essential unless it is used to network and grow your business.
  • Next make a list of the future items that will be additional costs, such as rent, cable, electric to the new house.
  • Lastly, start the painful process of making tough choices and cuts.

 

A 2nd myth is that women make less than their husbands.  We have found in the recent years that there are more women graduating from college and some women have been thrust into the role of breadwinner for the family because the man has lost his job.  We can no longer assume that women make less than men and there should be no bias in terms of gender when resolving conflict.

 

Remember without a budget and a firm plan to stick to that budget, debt can easily creep up and it is not unheard of to hear about divorced people going through a bankruptcy when everything catches up to them.

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