Welcome back and thanks again for joining us here at The Kronzek Firm in Oakland County, Michigan. We’ve been discussing the issue of how a divorce can wreak havoc with your finances if you’re not careful, and how to avoid having your divorce trash your credit. As we mentioned in the previous article, your first steps need to be taking stock of your situation so you know exactly what you’re up against, and not making poor choices that can lead to more debt (like “retail therapy” on rough days, and opening more lines of credit when cash feels tight.)
More tips for keeping your credit up after divorce:
- Set yourself a budget and then stick to it!
Budgets may sound boring, but if you’re hoping to get out of this with your finances intact, a budget is going to be your best friend! Let’s say you sit down and assess your finances, and you discover your monthly cost of living is $4,000, if you only earn $2,000 a month, you either need to make some major life changes, or you’re going to end up drowning in debt in the near future! So what can you do?
Sit down and make a list of what your monthly expenses are. This includes all your bills, your basic needs (like food and gas), and any unavoidable monthly expenses you may have (like docotr’s copays). If what you earn is less than what you use monthly, you need to figure out what you can cut out, or scale back on. Shopping at cheaper grocery stores, cancelling satellite TV (or replacing it with something cheaper like Netflix) and suspending your gym membership may all be requirements for this transitional time in life.
- Cut all financial ties with your spouse!
Divorce can be a contentious time, and some spouses use finances (a poor financial decisions) as a way to get revenge. That’s one reason it’s so important to be aware of your financial situation. But remember, cancelling joint accounts during the divorce process and splitting up your savings account as you see fit before the ink is dry on your divorce judgement can get you into a lot of trouble! Then again, by the time the divorce is final, you need to have severed all financial ties with your ex. It can be a tricky line to walk, which is why you shouldn’t make any financial decisions during your divorce without talking to your attorney first!
Being financially tied to your ex after the divorce means that their spending habits could come back to bite you! If they rack up a lot of debt, or struggle to live within their means, you’re could be saddled with some of that mess if your name isn’t removed from those accounts and bills! So make sure that by the time your divorce is final, your attorney has helped you cut ties!
Establishing your new future will take sacrifice, but it’s worth it!
You might be ready for a divorce, but afraid of the financial implications. Or perhaps you’ve decided you want to end your marriage, but your concerns about how to handle the money aspect of a divorce is holding you back. We understand – it can be a daunting process. But you don’t have to do this alone! We’ve helped hundreds of client through the divorce process. We’ll get you through this together.
Here at The Kronzek Firm, our experienced family law attorneys have been helping the people of Oakland County with every aspect of their divorces for decades. Whether you live in Troy, Bloomfield Hills, Royal Oak or Birmingham, we’re here to help. Just call (248) 479-6200 and you’re well on your way to having one of the best divorce teams on your side. We’re available 24/7, and we’ll help you through this.