Managing finances following a divorce

Getting a divorce can significantly change your financial situation, and once you are divorced, you’ll need to reassess your finances. After your divorce is final, it is wise to allow time to pass before making any major financial decisions. When you are ready, there are a few things you can do to move forward financially.

Determine necessary financial tasks 

Get a firm grasp on your financial situation. Start out by requesting your free annual credit reports and review them for accuracy. Make sure that the accounts listed on the report are indeed your financial responsibility. Also, determine a procedure to pay bills, make deposits and withdrawals, get cash, and pay taxes. Using automated bill pay with your bank is the easiest way to make sure your bills are paid on time. This is probably a good time to make sure that you are doing all of your banking with the best bank for you. Review the convenience of the bank, as well as the fees and the benefits.

Locate important personal and financial documents

You will need to locate important papers such as tax returns, wills, insurance policies, birth certificates, mortgage documents and Social Security cards. You may also wish to update some of these documents based on your new situation. Store up-to-date documents in a safe location that’s easily accessible. Revisit each of your insurance plans, including health insurance, to make sure that you are appropriately covered in case of emergency.

Create a new spending plan and budget 

Changed circumstances call for a new budget. Go through each of your expenses and decide how you can reduce each expense to reflect your new situation. It’s important that you work hard to reduce your expenses to be equal to or less than your income. Any extra income you find can be used for savings.

Set new personal financial goals 

Most likely, your experience changed your financial priorities. Decide what you would like to do with your money and put a plan in place to make your goals a reality. Make sure that your goals are realistic and flexible or frustration will keep you from achieving them. Also, review your investment plans and types of accounts–any life change is a good time to make sure that you are on the right track. 

Most importantly, enlist the help and support from your family, friends, and community.

  • The Consumer Federation of America (CFA) is an association of nonprofit consumer organizations that was established in 1968 to advance the consumer interest through research, advocacy, and education. Today, nearly 300 of these groups participate in the federation and govern it through their representatives on the organization's Board of Directors.
  • The National Council of Higher Education Resources (NCHER) is the nation’s oldest and largest higher education finance trade association. NCHER’s membership includes state, nonprofit, and for-profit higher education service organizations, including lenders, servicers, guaranty agencies, collection agencies, financial literacy providers, and schools, interested and involved in increasing college access and success. It assists its members in shaping policies governing federal and private student loan and state grant programs on behalf of students, parents, borrowers, and families.

  • Since 2007, the Homeownership Preservation Foundation (HPF) has served as a trusted, neutral source of information for more than eight million homeowners. They are partnered with, and endorsed by, numerous major government agencies, including the U.S. Department of Housing and Urban Development and the Department of the Treasury.

  • The mission of the U.S. Department of Housing and Urban Development (HUD) is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD works to strengthen the housing market in order to bolster the economy and protect consumers; meet the need for quality affordable rental homes; utilize housing as a platform for improving quality of life; and build inclusive and sustainable communities free from discrimination.

  • The Council on Accreditation (COA) is an international, independent, nonprofit, human service accrediting organization. Their mission is to partner with human service organizations worldwide to improve service delivery outcomes by developing, applying, and promoting accreditation standards.

  • The National Foundation for Credit Counseling® (NFCC®), founded in 1951, is the nation’s largest and longest-serving nonprofit financial counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services.