Divorce isn’t cheap – that’s old news. But while your split is likely to put a dent in your savings account, it doesn’t have to leave you in the poorhouse! Just because your marriage didn’t work out, doesn’t mean you need to sleep in a box under the overpass, or end up at the soup kitchen for dinner. So how can you get divorced without destroying your financial future? Well, it starts with protecting your credit. Here’s how…
There needs to be a reckoning!
Sounds scary, but actually a reckoning is a great place to start! As in – take stock of your current financial situation. Look at everything you have available to you (both liquid cash, and assets that could possibly be sold in order to make more cash available, should you need it.) Make a list of what’s available to you.
Being aware of what you have and don’t have, and keeping your expectations realistic, can save you a lot of grief down the road. Another great places to start with this process is pulling your credit report. It’s amazing how many people have no idea what their current credit score is.
Avoid new opportunities for increased debt!
This may sound obvious, but when that new credit card offer comes in the mail, it can be very tempting. Especially when you know money’s going to be tight for a while and that second (or third) credit card could help you carry the extra weight for a while!
Don’t do it! Extra lines of credit are really just new opportunities for debt. Running up big bills on your credit cards just means you’re going to be paying a lot of added interest. So if there is ANY WAY to avoid accruing new debt, we highly recommend you do that. This is likely to be a financially difficult time, so don’t make it worse with feel-good shopping or impulse purchases!
Put limits on yourself!
Budgets may be boring, but they’re critical to your survival during times of financial shortage. If your monthly cost of living is $4,000 and all you earn every month is $2,000 you either need to make some major life changes, or you’re going to end up drowning in debt!
Sit down and make a list of what your monthly expenses are. This includes all of your bills, your basic needs like food and gas for the car, and any unavoidable monthly expenses you may have. If what you earn is less than what you use monthly, figure out what you can cut out, or scale back on. Shopping at cheaper grocery stores, cancelling satellite TV (or replacing it with something cheaper like Netflix) and suspending your gym membership may all be requirements for this transitional time in life.
Make sure that you’ve severed financial ties with your spouse
Cancelling joint accounts during the divorce, or splitting up your savings account as you see fit before the ink is dry on your divorce judgement can get you into a lot of trouble! But know that by the time the divorce is final, you need to have severed financial ties with your ex. All joint bank accounts need to be closed, and all bills in both your names need to be assigned to one of you.
Being financially tied to your ex after the divorce means that their spending habits could come back to bite you! If they rack up a lot of debt, or struggle to live within their means, you’re going to be saddled with some of that mess if your name isn’t removed from those accounts and bills! So make sure that by the time your divorce is final, your attorney has helped you cut ties!
Do you need help with your divorce in Michigan?
If you or a loved one are considering divorce, but are nervous about the cost involved, come and talk to your skilled family law attorneys at The Kronzek Firm. We offer a free initial consultation to all of our potential clients, which will help us get a good idea of what your divorce will involve, and allow us to explain what you can expect. We’re available 24/7 to help you prepare for your divorce, and to walk you through the process, no matter what it entails. Call 866 766 5245 to schedule your appointment today.