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How to recover financially after a divorce

On Behalf of | Dec 5, 2023 | Divorce

A divorce may result in the loss of retirement savings, money in a bank account or your Michigan home. Therefore, if you are planning on ending your marriage in the near future, it’s important to consider how it will impact your finances both now and in the future. Taking proactive measures now may make it easier to survive and thrive on your own.

Create a budget

One of the most basic steps toward financial recovery is understanding what you have to work with. If you were the lower-earning spouse during the marriage, you may receive alimony from your former partner. You may also receive the majority of funds in a bank account or other resources in a final divorce settlement. If you were the breadwinner during a relationship, you may need to account for alimony, child support or other payments when creating your budget.

Consider downsizing

Downsizing your lifestyle may make it easier to build up an emergency fund or rebuild your retirement nest egg. Cutting back may include selling your house in favor of a condo or apartment that is easier and less expensive to maintain. You may also decide to keep your current car in favor of buying or leasing a new one every three years. Alternatively, you could look for a second job or other ways to make money to support your preferred lifestyle on your own.

In addition to securing your financial future, being proactive during divorce proceedings may also help in other ways. For instance, gathering deeds to a home or the title to a car may help you prove it is your separate property. Furthermore, gathering detailed records may also help if you are seeking custody of a child who was born during the marriage.