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Standing Strong for Your Rights

2 tips for getting your finances together after a divorce

On Behalf of | Mar 26, 2022 | Divorce

Divorce is a tough undertaking, both financially and emotionally. The divorce process is always filled with uncertainty. What will the divorce mean for your family? How about your children?

Because no two divorce cases are the same. A divorce, especially a contested one, can leave you with a huge bill. Here are a couple of steps that can help you streamline your finances after the divorce

Understand your new tax status

The tax implication of the divorce is usually one of the last things divorcing couples think about during those tumultuous moments. However, as you prepare for the divorce, there are a number of things you need to keep in mind. Once your divorce is finalized, you will be eligible for the head of the household status upon meeting the following conditions:

  • You were officially single, divorced or legally separated as of December 31st.
  • You lived with a child or other dependent for at least six months.
  • You paid at least 50% of the home upkeep (home insurance, real estate taxes, utilities and repairs) for the tax year.

It may be wise to speak to an accountant to make sure that you adjust your income tax withholding according to your new tax status as soon as your divorce is final.

Revise your budget

The end of your marriage, and subsequent separation, means that you will need to review how you manage your household finances and expenditures. Obviously, you will no longer have someone to share those bills with. However, there are a number of ways you can manage your finances and live within your new means. This is where budgeting comes in. Here are a few tips that can help you get your budget in line:

  • Have a clearer idea of your income
  • Know your expenditures
  • Create a healthy spending culture

Besides taking a toll on your emotions, divorce can also hit your finances. With your divorce settled, it is important that you make deliberate steps to ensure that you have a softer financial landing.