One of the most difficult things to deal with after a divorce is figuring out how you’ll provide for your kids after a divorce on one income. Yes, you may be getting child support, but counting on those payments can be risky, and they’re never as much as the two of you were able to spend on the kids together. Everyone in the family is dealing with the emotional fallout of the divorce, so making sure you’re financially secure can provide some much-needed stability. Here are some tips on making the transition to a single-income household successfully.
4 Tips on How to Provide for Your Kids After a Divorce
1. Start Budgeting Now
Everyone should have a household budget. If you’ve never done one before, there’s no time like the present. Sit down with your bills and determine your monthly expenses. Separate your mandatory costs like housing, food, and vehicle, from your discretionary income like movies, clothing, and eating out. After you’ve established your costs you’ll need to allocate your income to those expenses. Ask your kids who are old enough to understand to sit down with you and talk about how discretionary income should be spent. Put everyone in the house on an allowance, including yourself. Be realistic with them but don’t frighten them. Try to put a positive spin on budgeting since it’s a positive step to take for finances and something you should be modeling for your kids. This is a great start in providing for your kids after a divorce.
2. Plan for a Brighter Future
If, after budgeting, you discover there is simply no way to make your income meet even your basic requirements, it’s time to make some changes. Consider going back to school for a college degree in a growing field like nursing or technology. You can apply for student loans, scholarships, and grants that can pay for school and help with your living expenses while you finish your diploma. You can achieve an RN or become a web developer in as little as two years and then earn well over $60,000 a year.
Look at making additional cuts like downsizing your home or doing without a car if you live somewhere with effective public transportation. If your budget is closer to making it, but a little tight, use your guidelines to cut down on nights eating out and other “blackhole spending.” Planning meals and cooking with your kids can be a healing and team-building experience during a tough time, so it’s a win-win.
3. Build Credit in Your Own Name
Another thing that is important to your long-term financial health is building your credit. If your home, cars, or utilities were only in your ex-spouse’s name, you’ll be starting at scratch. Open a credit card but don’t rely on it to pay your bills. Instead, pay off any balance each month so it is reported to the credit reporting agencies. Over time it will help you qualify for car or home loans at low rates that will keep you from going into debt. If you rent your home, ask your landlord to report your on-time payments to the credit agencies as well.
4. Save Money to Provide for Your Kids
Once your budget is to a place where you have more money coming in than going out, you should be saving every spare dime. In fact, put those alimony or child support payments you do receive in this pot. Paying yourself first is the key to financial security. Whether you keep it in savings or invest in the stock market, you should have three to six months’ worth of expenses saved up for an emergency.
This is separate from any retirement savings and should be something you can access quickly, without penalty. With an emergency fund, you’ll be able to weather an unexpected job loss, a car accident, or a major repair cost without going into credit card debt. Unfortunately, more than half of Americans can’t afford even a single $1,000 unexpected bill. You could easily rack that up with a trip to the emergency room with one of your kids or if the radiator on the car unexpectedly goes out.
Follow these tips to not only reach your financial well-being but exceed it. These tips will not only benefit you but will also help you provide for your kids after a divorce.