Divorce is exhausting. No matter the circumstances, the process of extricating yourself from a marriage is emotionally, mentally, and spiritually challenging. One aspect of life after divorce that is often overlooked is that of financial stability. You were possibly dealing with a two income household, or with being a full-time housekeeper and caretaker, and now it’s time to readjust. Rebuilding your life can be challenging - to say the least!
But as stressful and painful as divorce can be, you can recover both emotionally and financially. As you begin to redefine your life - where you want to live, how you want to spend your free time, with whom you want to socialize and even, eventually, how you’ll approach dating - you’ll find that this can be an exhilarating time of opportunity and change. It’s time to take control of your destiny and explore your options!
Financial freedom is the foundation of a prosperous and fulfilling life and it is defined differently by every person. Whether you long to be debt free, want to start your own business, or covet the stability of a retirement nest egg there are several basic steps you can take to begin the process of recovering financially after your divorce.
4 Steps To Financial Freedom After Divorce:
1. Start Now
Your emotions are raw and your life is in flux in ways you never expected. It’s understandable to feel overwhelmed with the thought of restructuring your finances. But for every day you procrastinate and put off working through your personal finances, you’re endangering your future. This is a chance for your new beginning! You have to commit yourself to taking action and being the decider of your own future.
2. Take Inventory
Now that you’ve taken the monumental first step of beginning, it’s time to get to work! Gather all of your financial documents in one place and take stock of your financial life; your income, assets, expenses, and liabilities. Use whatever organizational system works best for you; an Excel spreadsheet, a written ledger, a loose-leaf binder.
Create a separate sheet for income, assets, expenses and liabilities. Itemize all of your accounts, credit lines, and loans by institution and amount and make sure to note who owns each account and at what interest rate. Knowledge is power - you’ll be amazed how empowering and cleansing it is to have all the information about your personal finances laid out in front of you in black and white.
3. Develop a Budget
Now that you have an inventory of your income and expenses, you can compare them and begin to build your budget. After divorce, it’s common to need time to readjust to your new cash flow and expenses. Just be sure to guard against sinking into debt while you adjust because it is so much harder to climb out of that hole than it is to dig it.
If you don’t know what your expenses are or how much you spend on average, start keeping track now. Understanding your expenses informs all of your next steps. The higher your expenses the more money you’ll need to bring in to support your lifestyle. Knowing what you spend will help you decide if you should moderate your lifestyle or if it’s time to get back to work.
There are so many tools that can help you create a budget that makes sense to you, but no matter how you format it, a healthy budget is one in which income exceeds spending with a little left over for saving.
4. Get to Work
If your finances tell you that you need a cash influx, or even if you’re just not ready to retire, now is the time to consider your next career path. Do you want to work for someone else or do you want to work for yourself? If you’re drawn to the idea of being your own boss, but you don’t know where to start, there are many available opportunities open to you; starting a new business, buying an existing business or buying a franchise, are all common choices.
If you don’t like the risk of starting your own business or have the capital to invest in an existing business, buying a franchise is an excellent alternative. Franchises have built-in systems, marketing strategies, and support systems, and they usually offer ongoing coaching and consulting to franchisees. You also have the comfort of a community of fellow franchisees who can help guide you and cheer you on as you begin your endeavor. p No matter what path you choose, the most important thing is that it’s your path.
This is an opportunity for rebirth and you get to choose exactly what you want your future to hold! If you know what you want, but you’re still a little fuzzy on the details, that’s okay - there are tools to help you find exactly the right opportunities for your lifestyle.
*Jane Stein is the founder of Your Franchise is Waiting, a consultancy firm for men and women exploring franchising as an alternative career path.