Without a doubt, divorce can bring serious changes on the family, financially. It have shown that parents particularly the mothers have found themselves living in poverty or, has substantially lower income bracket after divorce according to studies. Basically, the same thing can also happen even to the non-custodial parent with a decent income. With regards to this matter, it is essential to form a good financial planning strategy that’ll help you avoid the shock and also, help you have an idea of what to expect.
You may want to keep on reading to learn more about the things to be done.
Tip #1. Expect the unexpected expenses – the former spouse normally find themselves to be spending more money than what they must on everyday items after divorce. The reason for this is, they end up in replacing all small things that they’d used to take for granted similar to tools, kitchen utensils, towels, cameras and so forth. These small purchases that they make all add up to a big expense when combined.
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Tip #2. Determine child support – have you calculated the amount of cash that you’ll expect to receive or, that you’ll be paying for child support? If not, then you should do as the amount of child support will vary from one state to the other. However, if you can find a general guideline on how the support is computed, it’ll be nice for you.
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Experts have showed that the payments for child support do not always cover the total expense of raising a child. So if you are on the receiving end, don’t expect that it’ll cover for everything. In the event that the support is delayed, it is important that you have a contingency plan in place.
Tip #3. Consider your credit score – after divorce, there is a possibility that your credit score may be affected as well. This can make it much harder to apply for home loans or get a car and moreover, it could increase the interest rate on your credit, which you should factor in your budget as well.
Tip #4. Expenses could rise when you’re expecting them to fall – there are lots of divorce couples who erroneously assume that they will have half the costs they spend after the divorce. Simply, this is not true as while the living cost per house might go down, it’ll rise substantially on per person basis. The reason behind this is that, you no longer benefit from economy of scale. Meaning, each of you has to maintain a separate of everything from utilities, residence, food and so forth.