On behalf of The Law Office of Gustavo E. Frances, P.A.
Ending a marriage is not just about going separate ways with your spouse, but also becoming financially independent and handling your own budget. And while some consider this an advantage, budgeting can be quite confusing if you have recently divorced.
Budgeting is not exactly as easy as putting two and two together. Rather, it requires meticulous planning, forecasting, and ability to assess risks. Budgeting smart is a vital ingredient to surviving financially as an independent individual after a divorce.
You no longer rely on your spouse to bring home the dough. And neither can you rely on alimony or treat it as a stable life-long “income.” Instead, you will have to earn a living and provide for yourself and your children.
While a Fort Lauderdale divorce attorney will not be able to handle all the financial planning for you for the rest of your life, you may want to consult with an experienced lawyer at the Law Office of Gustavo E. Frances, P.A., to find out what you should be prepared for in terms of finances and budgeting after a divorce.
Basic rules of budgeting and financial planning after a divorce
If you were not the one who handled the finances during your marriage, it will most likely feel quite challenging to get the hang of planning and budgeting on your own. In order to avoid accumulating debts and going bankrupt after a divorce, it is highly advised to carefully monitor your expenses and income in the first six to 12 months after getting divorced.
Also, do not forget to draft a plan and forecast your monthly expenses (rent, food, utilities, mortgage, etc.) and compare it to your monthly income. While alimony can be part of these calculations, do not rely on alimony payments much, as they are not infinite.
Some people say that living separately is actually more expensive than living with your spouse. And that may be true considering that roughly half of your assets and properly will most likely stay with your spouse after a divorce. At first, it may even seem frustrating and stressful to be financially independent after a divorce, but it gets better if you adopt a smart approach to budgeting and planning.
Alimony is no more than a temporary bubble of dollars
While receiving alimony will feel like a godsend after a divorce, do not treat it as a permanent solution to your financial struggles. Our Fort Lauderdale divorce lawyer reminds that alimony payments can stop any second, right when you do not expect it.
Many people tend to forget that they will no longer be eligible to receive alimony not only when they get remarried or move in with their new partner, but also if their ex-spouse, who is paying alimony, retires, becomes disabled, loses his/her job, dies, or there is a substantial change in circumstances.
The bottom line is that you should treat alimony as a temporary bubble of dollars that could burst any second. It is highly advised to spend the money that come from alimony payments to fund your education, acquire new skills and specializations, and pay for everything that can help you get a job and start earning a living on your own.
Also, do not forget that alimony is taxable, so every time you receive an alimony payment, it is recommended to set aside some portion of it to pay the taxes on it.
Prioritize certain expenses and hold off on non-essential ones
This should be the foundation of your financial planning after a divorce for the next six to 12 months or until you find a job with a stable and sufficient pay. While it is important to set aside a certain amount of money to cover the cost of living expenses, you may want to hold off on big purchases.
Regardless of your financial situation after a divorce, our Fort Lauderdale divorce attorney at the Law Office of Gustavo E. Frances, P.A. advises clients against buying a new house or car immediately after a divorce, especially if you are receiving alimony.
In addition to the obvious risk of running out of money, there is also a huge risk of your ex-spouse attempting to end alimony payments by arguing that you are doing quite well financially.
Last but not least, do not underestimate the importance of health insurance after a divorce. While getting insured may seem unimportant after ending a marriage, getting a health insurance policy is vital in order to protect your health even though it is quite expensive.
Speak to our attorneys to get a free consultation about your particular case. Getting divorced can be tough when you do not know what to do and how to handle your finances. Let our lawyers help you by calling our offices at 954-533-2756 or complete this contact form.