BlogBudgetingInvestmentMoney MindsetSuperannuationHow to rebuild your finances after divorce

August 7, 2021by Natallia Smith

Going through a divorce can be an expensive and exhausting process. When so much of your energy has been focused on just getting through it, it is not unusual to find yourself on the other side of it, wondering– what do I do now that it’s done? As everyone around you chimes in with their own opinions, and your fears about the future begin to creep in, you may find yourself wanting to hide under the covers and leave the decision making to somebody else.

But it doesn’t have to be that way!

The time after a separation is an opportunity for immense personal and financial growth. A time when you can finally put your needs first, pursue what matters to you and rediscover what an amazing woman you are.

Here are four simple steps you can take to help you rebuild – your life, your dreams and your finances, after divorce.

Step 1: Rediscover yourself

It is no secret that women give their all in a relationship. We put the needs of our partner and our children above our own without a moment’s hesitation. Even now, you may find yourself setting goals and making decisions based on what other people may think you should do or based on what is best for everyone else. But I urge you not to do that. As the saying goes, you cannot give from an empty cup, so now is the time to think about what you want and need first and foremost.

A great exercise to do is to ask yourself ‘if money was no object, and if I wasn’t worried about letting anyone down, what would I want my life to look like?’ Consider – where would you like to live? How would you spend your days? Who would you spend your time with?

If concerns about what is financially possible pop up, write them down and put them to the side, but return back to your ideal vision. Why? Because too often we limit our ambitions and let the numbers speak for us, when in fact we are the ones in control. So let’s focus on your vision first, and we can deal with the numbers later.

 

Step 2: Put numbers to the goals

Speaking of numbers! Now that you have an idea of what your dream life would look like, it is time to break it down into some tangible goals. How much does the dream home cost? How much money do you need to earn each year? If you have plans for buying a car or taking a big trip overseas, write down numbers to those goals as well.

 

Step 3: Assess your situation

Now is time to roll up your sleeves and take a look at what tools you have available to you in order to achieve your goals. List everything you can think of. You may have equity in your home, have received a lump sum in the divorce settlement or perhaps a combination of both. If this is not the case, don’t lose hope. You still have your biggest asset – you! By focusing your efforts on boosting your income and being strategic about how you spend your money, you will open the door to more options that can help you bridge the gap from where you are now to where you want to be.

 

Step 4: Build your support network

I’ve said it before, women excel at taking care of others, but it is important to remember to allow others to take care of you as well! You don’t have to do everything on your own and now is the perfect time to reach out to your network for support, both personally and professionally.

Friends and relatives – whether you need someone to talk to or someone to watch the kids so you can get some much-needed alone time, don’t forget to reach out to your network, even if you think you can go it alone. Remember, many people want to help, but they don’t want to impose – so don’t be afraid to ask for what you need.

Medical professionals – divorce is a stressful time, so it is important not to neglect your health. Psychologists, GPs and alternative therapy providers are a must to make sure you are functioning at your best, so make room in your cashflow to look after your health.

Finance professionals – your accountant, mortgage broker and financial adviser will help you navigate all the little (and big) financial decisions you need to make so you can reach your goals quicker and keep your sanity intact in the process! To make the most of their time (and your money) be sure to go in armed with clearly defined goals and a list of all the questions you have. Remember, there is no such thing as a silly question, and these people are there to support you. The more openly you communicate with them, the better they will be able to help you achieve your goals.

 

 

 

 

Natallia Smith
Website | + posts

Natallia is a Melbourne-based financial advisor and founder of TruWealth. Her speciality is supporting single women to manage their financial affairs and achieve financial independence and security. 

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