Do you know what you spend each month on bills and basic living expenses? Have you ever kept a budget or paid the bills? If the answer is no, you are not alone. Most people I speak with have a minimal understanding of their spending habits, and for many women in divorce this is a common trigger for their fear.
Managing a budget does not have to be scary or overwhelming, you just need to find the right resource and tool to help you. Start by looking back at the last three months of expenses to begin building your average expense in each spending category. In our current world of unlimited applications there are several budgeting apps that do most of the leg work on tracking for you. If you prefer to write it out yourself, then excel will be a useful tool for you. The biggest hurdle to overcome in building a spending plan is first knowing what you currently spend, and I mean identifying where every dollar is spent.
With a clear understanding of your spending needs you now can answer some major questions during your divorce.
1. If you are hoping to receive spousal maintenance, you now have a clearer picture of your need
2. If you must find a new job you can now determine the salary you need to manage your lifestyle
3. You can clearly determine areas of your spending that can be reduced or cut out completely to better manage any reduction in income.
In divorce, one of the hurdles may be that you don’t have access to the bank account or credit cards to understand what you have spent in the past. This is something a Certified Divorce Financial Analyst® (CDFA®) can help you work through. A CDFA® can also help you to understand what other income sources may be available to you through your divorce, such as child and/or spousal support and marital property, to determine how you will continue to manage your budget once the divorce has finalized. Understanding your spending needs today and how they may change in the future will help guide some of your decisions throughout the divorce and provide clarity on how you will manage your financial future.
For more information on working with a Certified Divorce Financial Analyst® contact Next Step Divorce Solutions.