Warning: Think Now about Your Financial Life after Divorce
One of the biggest mistakes some women make in divorce is keeping the house. But part of the reason they do that is they make the other big mistake: not thinking about their financial life after divorce.
We’re not picking on women. Studies show women are more often the initiator of divorce. Meanwhile, they still earn less money than men, have less saved for retirement, and may have stepped out of the workforce to care for children or parents. On top of that, women tend to live longer. All of that makes divorce a financial challenge — and there’s no guarantee on alimony or spousal support.
While a good lawyer will suggest alimony and equitable distribution of assets, those will only get you started. Most people don’t think about money beyond the first year of divorce. After all, divorce is fraught with emotional and legal battles taking up your focus. But if you don’t consider the future and how you’ll pay for it, you might find yourself in trouble.
When you get divorced, you are going to have to learn how to do more with less. Your first responsibility is to cover your basic necessities, what one of the Second Saturday founders call “The Four Walls.” These are:
The Four Walls Strategy is simply a means to help you prioritize your spending and budgeting. Before you get divorced, determine the monthly cost of your four walls.
Figuring Out Your Post-Divorce Costs
A Certified Divorce Financial Analyst™ can help you figure out what your financial life might look like five to ten years from now. He or she can review those four walls and calculate your living expenses. That first year might be based on child or spousal support. But what comes later when that income runs out?
If you have questions about your future budget, contact one of our divorce professionals to schedule a consultation, or visit one of our divorce workshops, held in Raleigh on the second Saturday of each month.