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Staying financially stable after a divorce

On Behalf of | Nov 6, 2018 | Divorce, Firm News |

Recently divorced Nebraska residents should make sure that they don’t make irrational choices with their money. One reason is that there may not be enough money to buy a car or make other discretionary purchases on a single income. While it’s possible to take money from a retirement or brokerage account, doing so can result in a significant tax bill.

A person may be required to pay alimony or child support after a divorce is finalized, which may further erode that individual’s spending power. However, it’s a mistake to quit a job in an effort to avoid making those payments. At a minimum, losing a steady paycheck will further exacerbate an individual’s ability to pay bills or save for the future. Additionally, quitting a job to not pay alimony can result in spending more time in court and more money on legal fees.

Another potentially bad idea is keeping the family house in a divorce. This can be a financial mistake for many reasons. For instance, the home could be too costly to maintain or have negative equity. There may also be a mortgage payment of hundreds or thousands of dollars to make each month. Ultimately, this can result in having a home but no financial security.

The end of a marriage may leave an individual with several questions about how to plan for life as a single person. One may be wondering about the rights that they have to their children or if they should ask for the marital home in a divorce settlement. An attorney could review a case and provide guidance based on a person’s unique situation. If a prenuptial agreement exists, the lawyer may review that document as well.