Divorcing Your Old Budget: Marrying a New One

By Tara Eisenhard

The Good News:  Divorce affords you the opportunity to reinvent yourself!

The Bad News:  Divorce forces you to reinvent your budget too.

Married or single, we all feel the financial squeeze from time to time and many of us feel it the most when we take off our wedding bands (and contemplate selling them to pay for the divorce attorney).  At the conclusion of my marriage, I refused alimony or spousal support.  Knowing that I was facing a serious adjustment in my standard of living, I considered my financial obligations carefully.  It was time to make some uncomfortable decisions:

BreakingPiggybankMy choices:

  • The Marital Home - I only lived in my house for two months before I left.  In the months before moving in, my ex and I remodeled the kitchen, removed wallpaper dating back to the 50′s, painted every wall, had the ceilings textured and the hardwood floors refinished… we even hired an artist to hand-paint a few borders and murals.  After all that, I sure didn’t want to leave.  But, I couldn’t afford the mortgage on my own.I weighed the possibilities… I could live there and never ever eat.  I could get a roommate and rent out the apartment above the garage…I could rent half of the garage… but that would never be a guaranteed source of income.  I was also driving quite a distance to work and spending a couple hundred dollars a month on gas (that was when gas was only $2/gallon).  After weighing the options, I let my ex buy me out and I vacated our house.  I bought myself a new home, half the size of the one I left and much closer to my job.
  • The Car - I loved my car.  It had a supercharger!  But again… not practical.  It was bigger.  It guzzled gas.  When the treads wore thin, the tires would cost a lot to replace.  It, too, had to go.  I traded it for an uber-practical Saturn Ion with 4 doors, front wheel drive and neither bells nor whistles, but it got me from Point A to Point B.  It was a wise choice.
  • Phone - After a few months, I axed my land line and went solely cellular.  It saves a good bit of money, and I prefer my Led Zeppelin ringtone over that old-school sound piped through the copper.
  • Cable - I got rid of that too and went internet-only.
  • Clothes and Stuff - I’ve become a big fan of the second-hand market.  And I love it!  I can buy a new brand-name wardrobe each season for the price I’d otherwise spend on one new garment.  (The price factor is really nice when shopping for quickly growing children.)  And there’s a green aspect to the thrift-thing as well.
  • Credit Cards - Before my ex was my ex, he paid off my credit card as a Valentine’s Day gift.  After that, I began paying it off every month.  I know it’s tempting to use the plastic to help in surmounting the financial hump of divorce… but what if I needed that line of credit? I decided to continue using the card only for the sake of convenience, in case I needed it for an emergency.

Things I learned:

  • It is possible to adjust to an existence on a fraction of the income to which one is accustomed.
  • Practical = less hassle.
  • Be thankful.
  • Celebrate life.  Not things.

More Advice:

  • No more lattes.  That’s an easy one, I know.  And it’s hard, I know.
  • Look for entertainment alternatives and opt for more frugal family fun.
  • For the holidays, consider offering services (car washing, dog sitting, house cleaning, nail painting) or homemade gifts (in a jar?) in lieu of expensive (or even inexpensive) store-bought stuff.
  • Learn about money (and your attitudes about money).  Seek the advice of a Divorce Financial planner or check your community listings for opportunities to learn more about budgeting, spending and saving.  See if you can find any of these classes for your kids too- it’s never too early to learn good financial habits.

Dividing homes and incomes can mean a significant change in your standard of living, but with careful planning, you can retain (or even increase!) your quality of life.

Tara Eisenhard believes that families can evolve, not dissolve, through the process of divorce.  She is the author of the book The D-Word:  Divorce Through a Child’s Eyes and the blog, Relative Evolutions. Tara has studied divorce and blended-family dynamics and is passionate about sharing her vision with others. Follow her on Twitter @relativevolutns or her Facebook page.I know this will be a very timely post – January is supposedly the month with the highest number of divorce filings here in the U.S. One reason for that is people holding off on going public so as not to spoil the holidays. Another reason is people resolving to make a change for the New Year. Whatever the reason, there’s often a lot of fear associated with the financial piece and it’s scary because it can, as Tara describes mean so much change.

Knowledge is the key to facing that fear and when it comes to finances, it starts with gathering all the information you can about your finances and getting to understand exactly where you stand. It’s detailed work, it’s tedious work and it isn’t glamorous or exciting but it’s the foundation for every financial aspect of your divorce and a crucial part to reinventing yourself.

Are you setting any financial intentions for the new year?

Photo Credit: 401kcalculator.org

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