Making a Budget After The Divorce is Final

Hi,
It's now time to assess whether or not our income meets our monthly expenses. It's relatively simple to determine this. We total our monthly bills and compare the total to our monthly income. In many cases, people find that their expenses are higher than their income. Here are a few suggestions to reduce expenses:
1) Look at areas in which one can reduce costs, such as paring down a cell phone plan, cancelling cable, club memberships, subscriptions etc.,
2) Consider using public transportation whenever possible.
3) Consider eliminating some credit cards.
4) Examine the amount of money spent on entertainment/eating out every month. Check the library and Internet for free or inexpensive entertainment.
5) If expenses far exceed income, call creditors to set up repayment plans that work for both parties. Do not represent a payment plan to the creditor which cannot be kept.
For the twelve months following a divorce, it is important to be financially prudent and adjust lifestyles when necessary in order to transition into a solid financial future. Revisiting one's budget every three months and making adjustments as needed is recommended.
Tomorrow I'm going to write about what to do with your debt if you find yourself suddenly unemployed.
Until then,
Alan

Taking a Financial Inventory After the Divorce Decree

Hi,
After the divorce is final and the court has decided financial responsibilities, it's time to take a financial inventory. Since all situations are different, this is a list of possible suggestions which may be of use:
1) Living situation: Should downsizing be a consideration? Depending upon the circumstances, some people find it comfortable and financial rewarding to get a room mate instead of selling their home.
2) Transportation: Can we comfortably maintain our present vehicle, or do we need to get a less expensive one?
3) Outstanding credit cards: Look at all credit cards and determine balances, and monthly payments. It is a good idea to reassess whether or not all cards are needed and if it is a good idea to eliminate some of them.
4) Check all incoming bills to make sure the name of the ex-spouse is dropped from the statements.
5) Check beneficiaries listed on policies and make changes where deemed applicable.
Tomorrow I'm going to write about a budget based upon current income and expenses.
Until then,
Alan

Managing Debts During The Divorce Process

Hi,
When a divorce is filed, it is easy for the parties involved to adopt the belief that their debts can wait until the divorce is finalized. Putting this belief into practice can severely damage the financial future of both parties. Any financial obligations that either party takes care of during the divorce, that could in turn be ordered the other's responsibility, will be adjusted accordingly by a judge during the final divorce decree. Showing financial responsibility during a divorce may influence numerous decisions made by the court. Now that we have gathered all financial information available to us on debts for which we are liable, we need to notify our creditors of the situation. Different states have different laws in respect to who is responsible for marital debts in the event of a divorce. When calling creditors, it is important to establish a paper trail that:
1) The name of the person paying the debt after the divorce is filed is documented.
2)Credit cards such Visa, MasterCard, Discover or American Express etc., need to be notified that we wish to have our name removed, and that we are not responsible for any charges incurred after the date of our phone call to them. In most cases they will request that we follow up the phone call with a letter. At the same time, we can inquire about getting a card issued to us in our own name.
3)If we are the homemaker in the marriage and do not have an income to pay on any debts for which we are responsible, it is important to immediately contact our creditors. When contacting creditors, we need to explain the situation and let them know that we have no means of paying the debts at this time. We will keep them advised of our future financial situation once the divorce is finalized and our financial status is clarified.
As always, it is imperative to get the first and last names of any creditor with whom we speak. If we find ourselves blindsided, and left without any means to manage the situation, we need to ask a trusted friend to help us locate any available resources in our area. Tomorrow I'll talk about financial life after a divorce.
Until then,
Alan

Divorce and Debt

Hi,
In almost every divorce, the debt of the married couple turns into a problem. When the divorce is bitter, debt is totally ignored as each party believes that the other should be responsible for it. This is the equivalent of joint financial suicide. Even if the divorce is uncontested and emotions are in check, how efficiently the marital debt is handled during the divorce process can save both parties financial headaches in the future. The first step we need to take in order to efficiently manage debt during a divorce is to gather financial information in the marital estate and identify debts for which we are responsible. It is important to remember that even if we feel reasonably certain that the court will order some of these debts to be paid by our spouse, that we still need to deal with them until that time. This will assure our credit rating to remain intact once the divorce is final. If emotions are running amok in a particular divorce, it may be a good idea to solicit the help of a trusted friend or third party to gather as much information as possible on one's behalf. In situations in which all financial information isn't readily available, banks and mortgage companies will disclose pertinent needed information over the phone such as balances, monthly payment due dates etc., Another way to identify creditors of the marital estate is by running a credit report on both individuals. Tomorrow I will talk about some short term steps to take once the information has been gathered.
Until then,
Alan