Divorce can take its toll on your finances. Whether you became acclimated to having two sources of income or became used to your now ex-spouse handling the bills, a divorce can throw you a financial curveball. This is why it’s important to consider a few helpful strategies to rebound financially from a divorce. Here are five tips for bouncing back from a financial hiccup caused by divorce:
1.Change Your Tax Status
When you first started working with your employer, you filled out a few different tax forms where you identified your filing status. Given that you’ve now separated from the person you were married to, it’s important to go back in and change this. Changing your status will more than likely increase the amount of money you see in each paycheck. It could also increase the refund you see every tax season.
The good news? You can change your filing status any time you want. Unlike benefits, you don’t have to wait for open enrollment to come back around. When you change your status, you’ll either change it back to “single” or “head of household.” Single will be if you don’t have any dependents, while the head of household label could be suited to your situation if you have children who are still dependent on your income.
2.Identify Your Best Insurance Options
Much like your tax filing status, your insurance plan has a lot of control as to how much money is taken out of your paycheck. It’s possible that the plan you were on will no longer be the most efficient option now that you’re divorced. Contact your employer and talk about the process of transferring. You may have to wait until open enrollment, but you may have alternative options for changing it sooner due to the divorce itself.
If you were reliant on your ex’s insurance and are now stuck, an attorney can help you explore your best solutions for the time being. It’s possible that you may want to go with a cheap alternative until open enrollment begins again and you’re able to sign on with a better insurance plan.
3.Build Your Credit Back Up
Divorce can indirectly affect your credit if you and your spouse aren’t careful with the transfer and removal of certain accounts. Take some time after your divorce to build your credit back up. This can be accomplished in a few ways. First, rework your budget to accommodate monthly credit statements. This way you won’t accrue as much interest and get behind in even more debt. Second, if you relied on your ex for financial support, open your own line of credit. Be sure to do so on a secured credit card and make sure you may payments responsibly. Lastly, seek out a financial advisor. An industry expert can help anyone get back on their feet after the financial obstacles of a divorce.
4.Save For Your Future
It may be tough due to unforeseen divorce expenses, but saving for your future is more important now. Whether it’s a retirement fund, emergency fund, car fund, or house fund, putting money away into a savings account can help anyone rebound from a divorce. If you’re able to start this good habit just a month or two after the divorce is finalized, you’d be surprised to see the type of money you’re able to save up within just five years. You’ll be ready to make your next large purchase in no time.
5.Look For Other Income Sources
Dealing with a loss of income from your former spouse is difficult, but being able to look for another source of income can help anyone bounce back financially. This could look different depending on your circumstance – for some this is a part-time job, whereas for others it could involve the sale of certain larger items like cars or boats.
Find Your Divorce Resolution Today
Whether you’re trying to rebound from the financial hardship of a divorce or feel you’re owed more than what’s been discussed, the Law Offices of Jonathan Merel, P.C. is here to assist. We offer several different services, including but not limited to alimony and maintenance, divorce meditation, legal separation, and property division.
For more information on finding your divorce resolution, talk to our team of legal professionals over the phone today: (312) 487-2795!