Tranel Talks Column

How to Budget After a Divorce

If you think it’s hard to work out money differences when you’re married, try being divorced and handling financial decisions. If you’ve never been through a divorce, you can’t possibly understand the time and effort it takes to separate finances along with everything else two people can acquire over years or decades. There are divorce budgeting advisors who can guide you through this unfamiliar financial experience.

Once your divorce is final, you will have a new budget and probably a new set of bills to pay each month, so you want to have a plan in place to manage your money after divorce. Starting sooner rather than later is preferable so that you can be accountable for your finances as soon as the divorce is complete. You can call us as soon as one party files for divorce, and we will begin putting your new budget in place so that your current lifestyle will be as unaffected as possible.

Tranel Financial Group can help, with divorce financial planning advice and consultants who have stood beside clients in every type of divorce, from the most hostile to very amiable. Our financial advisors can work with your attorney throughout your divorce to reduce the overall costs that you will incur and prevent you from paying for the same service more than once.  In fact, we may need to be your first call, before an attorney, to begin budgeting right from the start.

Benefits of Hiring a Professional Divorce Budgeting Advisor

There are plenty of reasons to consider hiring Tranel Financial Group to manage your finances after a divorce. Our experience in this area proves that we have handled situations similar to yours many times, providing financial advice and much-needed reassurance in a difficult time.
If any of the following are important factors in your separation and divorce, then it’s worth your time and money (present and future) to discuss your options with us.

Helps Keeps Costs to a Minimum

Couples undergoing divorces often pay double for services that they easily could have split. With the right mediator, your divorce could cost up to half as much! Attorneys can help, but their first priority isn’t always your future financial health so much as getting you as much as possible during the split. A true financial advisor is one that can view financial matters impartially so that you and your spouse have nothing to be unhappy about when all is said and done. This good will is especially important if children are involved.

If saving money is important to you and your soon-to-be ex-spouse, let Tranel Financial Group work with you both or individually to find as many ways to save money as possible.

Helps Ensure Assets are Divided Fairly

Having a diversified investment portfolio is recommended for many married couples, but when it’s time to split everything right down the middle, it can get a little tricky. Physical property and monies need to be divided in specific ways so that the divisions are legal and fair for all parties.

Typically, whoever will be giving primary care for the children gets the family home, but there are always exceptions. If one person gets the house, it’s fair for the other to be compensated with money or other properties. However, in some unfortunate situations, couples cannot agree on the division of property, so everything must be sold so that the cash can be split equally.

No matter which situation you find yourself in, rest assured that there are professionals who care enough to listen to your concerns and do everything possible to advise you so that you and the other party leave the marriage with everything, or at least most of what you want.

Provides You with a Certified Witness, if Needed

In the event that your divorce proceedings take you back to court after the initial split, it’s helpful to have a financial advisor who knows the specific laws regarding personal versus marital assets. No one wants to think that their ex will be the one to come back weeks or months later to assert that they want things divided differently, but you can’t go through a divorce just hoping all will go well. You need to be prepared for the worst!

Having a financial planner who specializes in divorce budgeting can help you avoid tax infractions and unnecessary fees once your new budget is set. This means that your ex-spouse can’t claim your future earnings if everything is done right. Your Tranel Financial Group advisor can make sure of that. These certified pros are called to the witness stand more often than you’d guess to speak for newly divorced parties.

You can hire a Tranel Financial Group advisor to represent both parties during a divorce, or you can work with one independently. The relationship you have with your spouse is really the determining factor, and something you must tell us, not the other way around!

What Tranel Financial Group Does for Clients Dealing with Divorce

Divorce isn’t a pleasant experience, even in the best of cases. Hiring advisors who have the knowledge and finesse to handle your unique situation professionally is one of the few ways to soften the blow of such an impactful life change.

Here are the steps we’ll take to help you create a single-income budget after a divorce:

Determine your marital finances versus personal finances

If you own a business or entered the marriage with any amount of wealth, this step can be especially important. Just having everything clearly sorted out before you begin trying to reach an agreement is a huge step in the right direction, and one that should definitely be done with an advisor in your corner!

Some examples of joint finances include the following:

  • Joint debt
  • Investment properties
  • Family home
  • Benefit plans (pension, 401k)
  • Joint business

On the other hand, some of your independent finances might include any or all of these:

  • Gifts
  • Inheritances
  • Individual debt
  • Benefit plans established before the marriage
  • Individual business

Tranel Financial Group can help you navigate through uncertain times and ensure that you keep things that you were entitled to outside of your marriage and that everything you obtained as a couple is shared in a way that is fair, if not equal in every way.

Set some new goals

Once we have looked at your personal and joint finances, you will need to talk to us honestly about your plans for the future. Many of our clients have a hard time adjusting their thinking immediately after a divorce. Therefore, this step can be done at a later date, once you have had a chance to really think about where you see yourself in the future.

Short- and long-term goals must be reassessed when you get divorced. Were your goals for retirement things that you planned to do together? Have your interests and priorities changed over time? If you find yourself with a new idea of how the next several years will look – even into retirement – then there’s no better time to work with a financial advisor who can help you recognize these shifts in your goals and help you achieve them, even in a somewhat scary time of your life.

Just because you’re in an uncertain stage of life, that doesn’t mean that you have to be stressed out and worried about your future financial health. With adequate planning, you can have financial freedom after a divorce.

Get your expenses and income in writing

Putting things on paper can also put it into perspective. The tried-and-true practice of listing income in one column and expenses in the other is pretty standard practice. It can also help you face facts about your new financial situation, especially if you will be paying child support or alimony, or if you will be taking on expenses that were formerly shared, such as cell phone services or utilities.

The budget that Tranel Financial Group will help you put together will be much more advanced than one you might scribble on a napkin, though. We’ll account for every penny, including fixed and variable expenses, your new income and possibilities to generate more. In addition, our pros can find ways for you to balance the two columns if needed.

Don’t panic if your financial situation looks grim when going from a dual-income marriage to a single salary. There are many places you can cut costs and save money now and even set aside some for the future!

Once these steps are complete, we suggest keeping in touch with a financial planner who can guide you in your future endeavors. It’s helpful to have a support system in place after a divorce, and this should absolutely include an attorney and a financial advisor!

Whether you will be single for a while or remarry in the near future, you will need a clear plan for your finances to ensure that you enter the next stage of your life 100% prepared! Tranel Financial Group is your best bet for developing an effective one.