The financial aftermath of divorce sometimes leaves people in Pennsylvania struggling to pay bills. Even people with relatively high salaries often go through an adjustment period when shifting from a two-income to a single-income household. A divorce might add new expenses, like spousal or child support, as well. Regardless of their income level, many people have to overhaul their budgets after a divorce. A proactive approach helps to mitigate these financial challenges. Post-divorce budgets should focus on meeting monthly expenses, attacking debt, and building an emergency fund.
Sometimes people find that they need to adjust their lifestyles to meet their expenses on a single income. If they have debts, then they need to make paying them off a top priority. This might require them to go without luxuries so that money can be directed toward debts. Refinancing debts into a single lower-interest loan could aid this effort. Budgeting might include paying for health insurance. Someone previously covered under a spouse’s health plan will need to obtain coverage. Learning new skills to get a better job or picking up a side hustle present ways to increase income and offset the challenges posed by debt and the high cost of health insurance. People should also find out how the divorce influences their tax filing status.
People who want to rebuild their financial lives benefit from setting specific goals. After paying off debts, people can focus on saving for retirement or a nice vacation.
The terms of a divorce settlement play a major role in a person’s future financial life. Legal advice during the process might inform a person about rights to retirement accounts, alimony or real estate. An attorney might negotiate a settlement that limits financial hardship and sets the stage for building a new life.