Take An Inventory
One of the most uncomfortable topics in life is money. Many of us were raised that it was impolite to discuss how much you made or how much you had and you certainly did not share what you owed. When going through a divorce, putting your head in the sand regarding your finances is not only irresponsible, it can be detrimental to your future and maybe even the future of your family. You need to know what you have and where it is invested.
Do you have savings, investments, properties? Do you have a college fund for your children?
Do you own your home or do you have a mortgage or rent? Get all your finances together so you can evaluate where to start.
What Do You Owe
You will be asked to write down all your expenses by your attorney and even if you do not have an attorney, write down ALL your expenses. Do not leave anything out, even the smallest expense counts! I found that breaking it down into categories helped me to account for things I had forgotten. There are forms that you can find to guide you if your attorney or accountant did not supply it for you.
Here is a link to the Florida Financial affidavit short form for example of what you will need to provide to the court.
I am including this only as a guide and to provide a starting point of what you should consider when accounting for your expenses. We sometimes forget expenses such as pets and between veterinary costs, grooming, food, supplies and boarding fees, this can add up quickly.
Get A Budget
After you establish what you have and what you owe, figure out what your budget will be to cover your costs and start to save or invest the rest. Again, having categories will help to break this down so it is not so overwhelming and you do not leave anything out.
Please trust me on this one. Things can come at you out of nowhere. There could be job cutbacks or unemployment, illness, accidents, unexpected expenses from your home, family or your divorce.
The point is, you do not always know what will challenges will come your way and you want to be prepared in case you are unable to foresee a major expense or a loss in income. One of the scary parts of divorce is it is all on you so it is time to get real with yourself and with your family. Make a budget and stick to it. Many templates are free and downloadable. I like this one from Kiplinger.
Start Saving
Even if it is the smallest amount every week, put some money aside for savings. If you skip the $4 coffee each workday and set that aside for a year, you would have an extra $1040.
Read 3 Ways to Cut Costs right now for more tips to save!