The idea of your finances changing dramatically due to divorce is a BIG trigger for people. The truth is you have to do a lot more with a lot less after a split, and that can make you want to bury your head in the sand. It's time to create A healthy relationship with your finances.
Divorce can have a significant impact on your finances. Many people find themselves struggling to rebuild their financial lives after a divorce. The good news is that it's easy and possible to create a healthy relationship with money after divorce!
Here are 5 tips to help you get started:
1. Get Real About Your Relationship With Money
Understanding your relationship with money is essential for women because our past experiences shape our beliefs and attitudes towards money. Our childhood experiences, our family's financial history, and our personal relationships can all influence how we relate to money.
Our past really does have an impact on how we view money. For instance, growing up in a household where money was scarce could lead to a fear of never having enough and trigger anxiety around finances. On the other hand, if you grew up in a family that overspent it could lead to a lack of financial discipline. What we learned about money growing up can have a direct impact on our financial health as adults.
Taking a hard look at your views on money is an important first step to build a healthier relationship with your finances. By doing so, you begin to shift your mindset and make better financial decisions that align with your goals and values and shake off old habits that might not serve you anymore.
2. Set Realistic Goals
Setting realistic goals is key to creating a healthy relationship with money after divorce. Whether you want to pay off debt, build an emergency fund, or save for retirement, it's important to set goals that are achievable.
Break your goals down into smaller, more manageable steps. Consider setting SMART goals - Specific, Measurable, Achievable, Relevant, and Time-bound. Breaking down your financial goals into smaller, more achievable steps can make them feel less overwhelming. For example, you may set a goal to save $100.00 each month for the next six months. This is a realistic goal that is achievable and measurable, helping you stay motivated and on track.
When you achieve a goal, take time to acknowledge your hard work and success.
3. Develop A Budget
Creating a budget is an essential part of managing your finances after divorce. Your budget should include all of your monthly expenses, including housing, utilities, food, transportation, and entertainment. Be sure to include a category for savings as well.
It's a big job, that's why I created an easy-to-use monthly budget calculator that takes the guesswork out of what to do! Developed with financial planners, the customizable spreadsheet has helped thousands of women take the fear out of financial planning and take control of their money. It's loaded with a detailed list of all of your expenses and it does all the math for you.
4. Build Your Credit
Building your credit is an important part of creating a healthy relationship with money after divorce. If your credit score took a hit during your divorce, there are steps you can take to improve it including:
Check your credit report and identify any errors or negative marks.
Make a plan to pay off any outstanding debts and bills. Consistently paying bills on time and keeping credit card balances low can also help improve your credit score.
Consider getting a secured credit card or becoming an authorized user on someone else's credit card to help establish positive credit history.
With patience and diligence, you can rebuild your credit after divorce and set yourself up for a stable financial future.
5. Seek Professional Help
Managing your finances after divorce can be challenging, and it's okay to seek professional help. Consider working with a financial planner or advisor who can help you create a plan to achieve your financial goals. A financial advisor can provide valuable insights and guidance, and they can help you develop a comprehensive financial plan and provide advice on investments and retirement planning.
Seeking professional help with your finances can also provide emotional support during this challenging time. By working with a financial advisor, you can gain confidence and peace of mind knowing that you are making informed financial decisions and taking control of your financial future.
PRO TIP: Most banks offer free financial planning services to customers at no extra cost!
Remember, the journey to financial health is a marathon, not a sprint. Take it one step at a time, and celebrate your progress along the way. You've got this!