Divorce is the biggest financial event of most people’s lives. The same amount of money that supported one household will now have to support two. Understanding your expenses and making a budget is an essential step in the divorce process.
Divorce is a highly emotional time. You begin to suffer from decision fatigue from making so many different choices. A budget helps you make better financial decisions. It measures how proposed settlements will impact you. Budgets also provide the framework as to how you will have to change spending after the divorce.
A budget makes your attorney more effective as they have the financial documentation to support your needs and interests. During the divorce process, it is essential to analyze the marriage as if it were a financial contract. Marital spending is based on your historical expenses and provides a starting point in your financial strategy.
Here's how to do it...
5 Steps to Create a Budget
1. Gather Historical Information. Track down the 6 months of bank account and credit card statements.
2. Download our Budget Worksheet.
3. Categorize Expenses. Using the statements you gathered, categorize each expenditure in the spreadsheet.
4. Average Totals. To understand your historical spending, find the monthly average for each category. Use these totals in the next step.
5. Projected Monthly Budget. Using the marital budget totals as your guide, carry over each expense along with an increase or decrease in value. For example, you plan on hiring out snow removal; the increased value would be recorded in the post-divorce budget.
Making a budget can be a major project. We make it easy. Simple give Divorce Analytics your historical documents and we will do the rest. Email firstname.lastname@example.org or call 402.430.3092 for help today!
Please note: This is general knowledge and is not tax/ legal/ or financial advice. Work with your professional team to find out what is best for you.