Women's Divorce Blog

Life After Divorce?

The hurt and disruption caused by a divorce can make you question whether there can be life after divorce. How can I pick up the pieces and how good will the quality of life be after a divorce?

Dealing with Debt after Divorce

  • You are not alone
  • Face up to it
  • Make a plan
  • Follow through with your plan
  • Avoid further debt

For many people living life after divorce can mean dealing with debt. Here are some tips for not letting it run (or ruin) your life.

You are not alone

Even those who are not divorced are dealing with more and more debt.  Many people are having trouble living within their means.  Major life events such as losing your job, divorce etc result in financial upheaval. This is a very emotional issue for many people.  Get professional help if you feel you cannot tackle it along. Let bygones be bygones.  What you did in the past cannot be changed but what you do from now on will affect how you deal with debt.  Focus on that.

Face up to it

Sometimes this can be the hardest part.  We are very good at putting off anything unpleasant, of finding excuses to do other things.  The problem is that the issue grows in the back of your mind, sapping your energy and perhaps keeping you up at night.  Worse the debt is likely growing too.

Here's how to face up to it 

  • Get piece of paper and divide into two columns
  • On the left side, list all your sources of income
  • On the right side, list all your debts
  • Start with essentials first: electricity, phone ...
  • Next list monthly payments: loans, credit cards...
  • Lastly list things you can survive without but tend to indulge in

Make sure the first two categories (essentials) are covered before you buy that ticket to the space station (indulgence). You can now use a treat to reward yourself if you have paid all the essentials.  Do not go overboard though.

Financial Documents

  • Update your life insurance including beneficiary
  • Make sure joint accounts and credit cards are closed
  • Update your will
  • Consider storage of important documents

After a divorce, some important documents that need to be reviewed can get left out.

Credit Cards

Make sure you no longer have joint cards. Call and confirm a change has been made. Do not assume that your letter has been received or that your request by phone has been carried out. Check your credit report to make sure its reflected there also.

Bank Accounts or other joint accounts

Check and see who can sign checks, withdraw money, obtain loans etc and make the necessary changes. This includes stocks and mutual funds.

Life Insurance

The beneficiary may need to be changed. Review and make changes as necessary. Now is a good time to check and see if you have sufficient coverage.

"Across all life stages, a significant number of consumers (around 40 percent) fail to review their life insurance policies on an annual basis."

  • Shop around
  • Compare your company's consumer complaint ratio to that of others in the industry
  • Review annually

You can check your company's consumer complaint ratio at the NAIC consumer information source

Downsizing your home

  • Get renters insurance
  • Read your lease carefully
  • Check if pets are allowed
  • Plan for storage of extra possessions
  • Get rid of clutter

Moving to an apartment

  • Get renters insurance
  • Check your lease carefully before signing
  • Check to see if pets are allowed
  • Understand what you can do to decorate your apartment
  • Recognize that some noise will be inevitable
  • Know where your security deposit will be kept and how much interest it will get
  • Check for storage space

Insurance

While people living in houses have insurance covering the contents, many apartment owners do not have their possessions covered and surprise! they are not covered by the landlords insurance. Apartment insurance is relatively cheap and easy to get.

Lease

If renting, check your lease to see what you can and cannot do. Check to see what the landlords obligations are. Local towns may have laws regarding when heat has to be turned on, rules regarding rent control and noise ordinances.

Pets

If you have pets, make sure pets are allowed before you sign the lease. Anticipate that if you have children, you may want to get them a pet at a later date.

Decorating

Understand what you can and cannot do decorating your apartment. Some leases will restrict the colors of paint that can be used.  Some landlords may pay or split the cost especially if its an improvement to the apartment.

Moving House after your divorce

  • Create a shopping list of "must haves"
  • Be prepared to compromise
  • Plan where large items will be placed ahead of the move
  • Make sure the moving company has insurance

As if the divorce was not stressful enough, many people either choose to move or are forced to move after the divorce.

Downsizing

Due to the financial impact of a divorce, many people have to downsize to a smaller house or apartment. This can be quite a change in lifestyle especially if the kids are uprooted from their family home.

How to start the search

These days you can do a lot of research online.

  • Create a shopping list of features you desire
  • Create a shopping list of areas in your price range
  • Prioritize this list into "must have" and "nice to have"

Often you have to make some compromises to obtain a suitable house. By separating out your list into "must have" and "nice to have", you know what you can compromise on and what you can't.

Some questions to ask yourself 

  • Do I have time to do maintenance?
  • How much storage do I need?
  • Will this living space be sufficient for several years?
  • Am I likely to relocate soon?
  • How good are the schools?
  • What are the property taxes and other fees?

Further Education Opportunities

  • Be sure you can handle the work
  • Think how you can fund the course work
  • Think about how to support yourself
  • Ask yourself how the education will benefit you e.g. salary

 

After a divorce, you may well be thinking about what you want to do with your life. You may decide on a career change or have found that you need further education to do better in your chosen profession.

Further education for divorced singles

You now have more freedom to pursue new interests and directions in your life. 

  • Consider your ability to apply yourself to academic work
  • Understand that remaining in a full time job and going to school demands considerable time and discipline
  • Find out if there is a program run by your employer to help fund further education
  • Is there an alternative employer that would help fund your education?
  • Will the college give you credits for “life experience”?

Changing Your Will after Divorce

Changing wills and inheritance after divorce and remarriage. Who will you leave your money and property to?

How do you change your will and inheritance to fit your new extended family?

Much of the wealth is held by those 55 and older as you can see in the graph below. Much of this wealth may be held in assets such as a house. For most people, this wealth represents a considerable investment of their working life earnings. Many have children and grandchildren and have thought about how to divide this wealth among their relatives and family.

Divorce and Mortgage problems

Has your divorce and subsequent financial situation put your home in danger of foreclosure? As the number of foreclosures rise, there are steps you can take to prevent foreclosure.

Respond to the Lender

If you mortgage payment is getting too much for you, talk to your lender. In about half of of cases of foreclosure, the borrower never talked to the lender. The problem will not go away by ignoring it. Respond to your mortgage company's calls and letters.

Getting Advice

You need to get advice from another party.

Talk to one of the following:

  • lawyer
  • accountant
  • housing counseling agency
  • consumer credit counseling service

Ask if they will help negotiate with the lender for you as well as providing advice.

How long will the problem last?

Decide if you have a short term cash shortfall or a long term problem. For short term problems, talk to your lender about a forbearance. The lender will delay or reduce the payments for a set period of time and there will be an agreement on how to make up that money later in a repayment plan.

If you have a long term problem, it can be solved by loan modifications. Theoretically, any term of a mortgage may be modified: The rate can be lowered, the final payoff date can be moved back, and even the amount owed can be reduced.

The environmental impact of divorce

In the United States (U.S.) in 2005, divorced households spent 46% and 56% more on electricity and water per person thanmarried households. Furthermore, U.S. households that experienced divorce used 42–61% more resources per person than before their dissolution.

The divorced household is smaller than the married household 

An interesting new study shows that divorce has an environmental impact as well as an economic one. The major factor appears to be that divorce leads to more households. According to this study, the average household size  in divorced households was 27–41% smaller than married households in 12 countries across the world between 1998 and 2002.

Divorce leads to an increase in number of households

We already know that running two households after a divorce is more expensive than running the original household but the less obvious fact is that we, as divorced people,  are consuming resources at a higher rate also. While it is well known that population size has an impact on resource use, population size does not explain increased resource use in countries where the population is stable. However large increases in the number of households have been seen even when the population is stable.

Divorced households use more resources

Divorced households spent 46–56% more money per person than married households on water and electricity. More than 73 billion kilowatt-hours of electricity and 627 billion gallons of water could have been saved in the U.S. in 2005 if the efficiency per person in divorced households had been the same as that in married households. This likely results in increased consumption of fossil fuels and emissions of greenhouse gases as well as an impact on water quality.

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