Going through a divorce is a difficult process, even under the mildest of conditions. Your financial situation may look very different after the divorce than it did while you were married. However, that doesn’t mean you can’t find financial freedom following a divorce.
Here are some things you can do to gain financial independence after a divorce:
Understand Your Financial Situation
You can’t expect to gain financial freedom if you don’t understand what your financial situation looks like. You must have a solid understanding of your circumstances before you can start the process of finding financial independence.
Take a look at the following:
- Your tax returns
- Retirement account statements
- Investment account statements
These documents will give you a good idea of where you are. Be sure to close any joint checking and savings accounts and open new ones solely in your name.
Review Your Life Insurance
Life insurance may be used during your lifetime if you really need it, through the use of a cash flow banking strategy. It’s like taking out a loan, except you don’t have to repay the principal of the money you take out, just the interest.
In addition, your insurance policy can still expand after you take the money out. If you prefer to pay back the principal, you have the flexibility to do so in your own time.
Develop a Viable Budget
After your divorce, your budget will likely have to change. Take note of your expenses, including the one-off costs such as birthday gifts, holiday gifts, and other seasonal expenses. This way you’ll be prepared for the unexpected costs that may arise in the future. If you spend more than your new budget allows, you may need to tweak your budget to accommodate your new situation.
If you have questions about the divorce process, talking to a family law attorney about your situation can help ease your concerns.