For many people, getting divorced is a bigger change than getting married. Couples often spend years building their lives together before and after the wedding. In contrast, divorces are over in months in most cases. This abrupt disruption affects every part of your life, particularly your finances. Understanding how your divorce may affect your monthly budget is crucial to smoothly transitioning into your new single life.
Why Divorces Impact Your Finances
Divorce decrees cover many subjects, but most of the average decree addresses financial issues that may impact your budget. Some of the most common divorce issues that will affect your finances include:
- Division of Property: When you split your marital assets, you may lose ownership of important assets like your home, vehicle, or retirement accounts. You may need to factor replacing those assets into your monthly budget.
- Potential Loss of Household Income: If your spouse contributed to the household income, you’ll face a lower monthly spending limit.
- Increased Costs of Living: Housing, food, insurance, and even entertainment subscriptions become more expensive when you’re not sharing the cost with another adult. New expenses after divorce can stretch your budget in ways you don’t expect if you’ve been married a long time.
- Support Orders: Both child support and spousal support may be included in your decree. They can supplement your monthly budget if you’re the one receiving support. However, if you’re the one paying, you’re legally obligated to prioritize support payments over discretionary spending.
Reducing the Financial Impact of Divorces
While preventing your divorce from affecting your budget may not be possible, there are many ways to reduce its impact. A skilled divorce attorney can help you avoid unnecessary financial strain with some of the following techniques:
- Build a budget and work backward. Don’t go into your divorce blind. Identify what you’ll need to live the lifestyle you want once you’re single. Having a realistic post-divorce budget makes it easier to prioritize during property division and avoid wasting time and money on pointless fights.
- Stay professional. While it may be tempting to dispute your spouse’s demands, keep your priorities in mind and stay professional. A calm and focused approach will keep your split on schedule and reduce costs.
- Negotiate with your spouse. When possible, negotiate matters like asset division and support. Negotiating gives you more control over the outcome of your split and can help you avoid excessive support orders.
- Litigate as a last resort. While negotiation is preferable, it’s not always an option. If your spouse makes unreasonable financial demands or refuses to collaborate, don’t hesitate to take matters to court to achieve a fair decree.
It may not be possible to avoid any financial impacts during your divorce. However, it’s absolutely possible to reduce them with skilled legal counsel. At the Viola Law Firm P.C., our expert family law attorneys have decades of experience helping our clients navigate divorce’s financial and legal complexities. Make an appointment with our San Mateo family law firm to learn how we can assist you with your high-net-worth divorce today.