Divorce can have a major effect on your finances. Some people even put off divorce long after they know a marriage is over out of fear of losing their financial stability.
The property division process in an Arizona divorce involves an equitable division of all your marital assets and debts. This usually means that you end up with a smaller portion of assets that you had when you were married.
Additionally, going from 2 incomes to 1 generally involves some type of lifestyle adjustment. Your own income might be enough to keep the bills paid, but it could take some time to get your overall finances back on track.
There are several things that you can do to regain financial stability after divorce and properly manage your money.
Hold off on making major decisions
Try not to make any major financial decisions during your divorce process or immediately after your divorce. Divorce involves heavy emotions, even an amicable divorce, and making important financial decisions when you are working through these emotions can harm you.
Focus on making sure your daily and monthly financial needs are met. Give yourself a little time after your divorce to assess your situation and get used to your new life before making major decisions, such as purchasing a home, changing jobs or taking out a loan.
Evaluate your financial situation
As part of this assessment, get a clear understanding of your financial situation. Review your assets and debts and obtain current values and balances.
You should then have a big picture view of where you stand financially. If your situation needs improvement, think about what steps you can take to change things.
Consider using a professional to help you develop a plan going forward. You might have used professionals as part of the property division process in your divorce, such as a financial analyst. Professionals can continue to provide you guidance after your divorce.
Review your credit reports
Obtain copies of your credit reports and check them regularly. Be on the lookout for any signs of fraud or inaccurate information.
Your spouse might be responsible for certain marital debts as part of your divorce settlement. Remove your name from these accounts as soon as you can after your divorce is final.
This is important because credit agencies do not honor divorce decrees. Therefore, if your spouse is ordered to pay debts as part of your divorce order but fails to make payments, your credit is still affected if your name remains on the account.
Be patient and live within your means
Recognize that the process of gaining financial independence takes time. Make every effort to pay your bills on time. Create a new budget based on your life as a single person and regularly review it and make any necessary adjustments.
Throughout this process, remember the goals you are trying to achieve. Protecting your credit, separating your finances from your former spouse and creating a financially stable lifestyle for yourself are possible with some time and effort. Following these steps increases your chance of having a solid financial future.