There are so many financial obligations that accompany a separation or divorce, especially since you will now be making so many of those payments on your own.
In order to keep your head above water, organize your financial records and learn the frequent financial mistakes others make so you don’t do the same.
Here are 8 steps to help you meet your household budget during a divorce:
1 – Make order of the bills. The first step in revising your budget is making order out of the bills and bank statements that overflow from your desk. This means collecting, categorizing, and creating folders for the bills.
2 – Organize important records. Critical documents like your will, birth certificate, passport, 401(k) statements, and tax returns, should be stored in a safe and easily accessible spot.
3 – Determine your spending each month. Once your documents are in order it will be easier to figure out how much money you are spending each month.
4 – Cut non-essential spending. By tracking your spending, you will be able to calculate what you spend on essential items such as rent, utilities, groceries, etc. and you will most likely unearth your non-essential spending habits as well.
5 – Reduce your debt. Pay your monthly bills on time and in full.
6 – Stockpile 6 months of savings. If possible, make sure you have about 3 – 6 months of living expenses in the bank.
7 – Consider your retirement. If you’re a parent, you don’t think twice about putting your children first. But when it comes to your personal finances, it’s a good idea to think about your retirement before your child’s college costs.
8 – Always have a plan.
With a little organization and a clear plan of action, you are well on your way to a manageable budget.