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Adjusting to your new financial normal after divorce

Divorce can be anywhere from challenging to devastating financially. Even people who obtain a fair settlement often find that they need to readjust their budget.

It's simply more expensive to live on one income than for two income earners to share a home and other expenses, even if you downsize, as many divorced people do, to a smaller home. There are a number of ways that you can make the transition to living on your own less painful.

The first step is to create a balance sheet. Determine what your assets, liabilities and expenses are. It's often helpful to have a financial advisor assist with this. Figure out where you can cut expenses in order to live within your new financial means. This may mean giving up some things you've been used to, like 400 cable TV stations or going out to dinner regularly.

You should also look at what you can sell to increase your assets. Some women, for example, sell their engagement rings and other jewelry from their exes.

Focus on small financial goals for yourself that are obtainable in the short term. As you achieve those, you can move on to larger ones. Less ambitious goals in the beginning can give you a sense of empowerment that will help you move on to larger ones.

Be creative. Look for opportunities in your area to have fun, particularly if you have children, without spending a lot of (or any) money. Are there free concerts in the park? How about budget movie matinees? There are tons of good deals out there if you look for them.

It is advantageous to determine realistically how much money you need to live comfortably (keeping in mind that it likely won't be the same as your married lifestyle) as you go through the divorce process. That's why it's important to do some financial planning as you and your family law attorney work out your divorce settlement.

Source: USA Today, "Divorce wiped me out financially. Here's how I bounced back," Tamara Holmes, May 25, 2017

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