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What you should do with your money after a divorce settlement

Knowing what to do with your money after a divorce can be challenging and scary.  You’re essentially rebuilding your life which can feel overwhelming. Here, we outline some first steps to navigate the process and come out the other end feeling like a boss.

Get an overview of your expenses

Taking stock of your expenses so you can get a clear overview of your current financial situation is the crucial first step in managing your money after a divorce. Chances are your expenses have gone up while your total assets have been divided between you and your ex-partner, leaving you with less money than you had when you were married.

Start by creating a spreadsheet with all your monthly expenses.  This should include rent/mortgage, car repayments, school or childcare fees, utilities, food and so on.  Anything you can think of, write it down. By understanding your expenses you’ll be able to create a roadmap of your cost of living over the short, medium and long term.

Work out how much you have

Now that you’ve outlined the outgoings in the short, medium and long term, it’s time to assess where you’re at right now. Divorce can have an enormous impact on your personal finances. The bottom line: do you have enough money to support yourself?

Go back to your expenses spreadsheet and start adding your capital.  This should include any support payments, income, super and so on. Subtract your expenses from your capital and you’ll have an instant snapshot of where you’re at – either in the red or the black.

Redefine your priorities

It’s only early days, so expect feelings of uncertainty and fear to creep up on you. If your calculations have shown that you’re going to run out of money, it’s time to redefine your priorities.  You need to put a firm plan in place so you can have financial security moving forward.

This process will look different for everyone.  The point is to look for areas in your life where you can make some serious changes to your bottom line. Can you move to a cheaper home? Or even move in with family for a while? Can you take public transport instead of buying a car? Or, is it time to get a new job, ask for a pay rise or start that side hustle you’ve been thinking about?  Get creative with this process and really tap into what lights you up and what doesn’t.  You might be surprised by the results.

Plan ahead

How you plan for your financial future will vary greatly depending on your age and life stage. But no matter where you are, planning ahead is crucial for avoiding financial stress and anxiety.

If time is on your side, put a plan in place to make small contributions over a long period of time.  There’s no time like the present to start preparing for a better tomorrow.  Your future self will thank you for it.

Be the boss

If you’ve always managed your own finances then chances are budgeting and keeping on top of your bills is second nature. For those of you who left the finances to their ex, it might be something completely foreign and challenging for you.

First up, know that there is plenty of help and advice available to you if you need it.  A financial planner can eliminate problems down the track, as well as empower you to take back control of your life. No matter whether you go it alone or with the help of a financial planner, it’s time to be the boss of your money and your future!

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Our response to limit the spread of COVID-19

  • As COVID-19 continues to spread, we would like to take a moment to let you know what Financial Spectrum is doing to respond.

    While we haven’t been directly affected with any confirmed cases, we are taking all reasonable precautions to remain safe.Our priorities are:

    1. Keep our staff and clients safe
    2. Stay fully operational in our service delivery and continuing to manage your financial affairs
    3. Play our part in minimising the impact on our community against the spread of COVID-19

    Financial Spectrum has the technology, infrastructure and systems to continue business as usual remotely and our staff will now be working from home.

  • You should notice no change to our service, with the exception that we are encouraging our clients to meet via video call, rather than face to face, unless requested. We will be contacting all clients with meetings booked over the next two weeks with instructions for a video call.This is an evolving situation and we will continue to monitor developments. We will keep you informed of any material changes to our approach.

    These are unprecedented times and we understand that many of you will be feeling unsettled about your finances. We would like to assure you that we are open for business and are here to help you. If you don’t have a meeting booked but would like one, or if you have questions, please contact us at info@financialspectrum.com.au or on
    02 8238 0888

Brenton Tong

Managing Director

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