Managing Finances After Divorce in South Carolina

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Divorce will bring many changes to your life, including your financial situation. After the end of your marriage, you may struggle to make ends meet, achieve your personal goals, or pursue your retirement plans. Preparing for the reality of divorce takes diligent planning and the assistance of seasoned legal counsel. Greenville, SC divorce attorney Angela Frazier helps family law clients through each step of their divorce.

How Divorce Affects Finances

Women tend to suffer more financially upon divorce. There are a few reasons that may explain why:

  • Giving up their careers: Many women forego career advancement for the sake of their marriages, choosing to raise children or help their husbands with their careers. Attempting to re-enter the workforce after a divorce can prove daunting.
  • Pay disparity: Across various industries, women are often paid less than their male counterparts in the same or similar positions. This is true even for highly educated, professional women and explains why women often bear a heavier financial burden than men.
  • Becoming a caregiver: Some women are called upon to care for an aging loved one, or they may have to take care of their spouses in the event of an illness. As a result, many of them must take a lower-paying position or work fewer hours.
  • Insufficient child support and alimony: Although child support is intended to help custodial parents (who are often the mothers) support their children, the amounts often aren’t enough. The same is true for alimony payments.

Men too can leave their marriages and struggle financially. Men can be faced with:

  • High child support and alimony payments: The wife might be awarded a substantial alimony and child support award as part of the divorce. Consequently, these could be amounts that impact the husband’s ability to save money and pay bills.
  • Debt distribution: Equitable distribution is a process by which South Carolina family courts distribute marital property and debt. The husband could be assigned a larger portion of the debt, which could mean significant monthly payments.
  • Property distribution: On the other hand, the husband could end up losing the family business or other lucrative property, or the marital home might be distributed to the wife, along with the equity and an affordable mortgage.
  • Loss of health insurance: Some husbands join their wives’ health insurance and other employer-provided plans. After the divorce, they could lose those benefits and be forced to insure themselves at a higher cost.

It should be noted that these situations may apply to either husbands or wives. Regardless of how much money you earn or property you own during your marriage, divorce could change everything.

Managing Finances During Divorce

Your divorce process could last for several months depending on your unique circumstances.

Prepare yourself by taking the following steps:

  • Check your prenuptial or postnuptial agreement: You may have executed a pre- or postnuptial agreement with your spouse that could include important terms that affect your finances.
  • Create and stick to a budget: There are plenty of free online tools for budgeting, which can help you identify and cut wasteful expenses.
  • Open separate bank and credit card accounts: You should open an individual checking and savings account in your name, preferably with a good interest rate (for instance, a money market account). Also, consider obtaining a credit card to help with emergencies.
  • Attempt mediation: Your lawyer should attempt to mediate your divorce, a process that could save you money, time, and stress.
  • Don’t neglect your retirement and investments: To the extent possible, continue contributing to your retirement and wisely investing. You might need more of these assets in the long run.

Managing Finances After Divorce

After the divorce is finalized, you want to ensure you are complying with all terms related to child support, alimony, and debt and property distribution. Once you get a handle on those, consider doing the following:

  • Adjust your budget: While everyone’s finances are different, as a general rule, you should aim to budget 50% for essentials (e.g. housing), 35% for non-essentials (which can be lowered if necessary), and 15% for savings.
  • Save for immediate needs: You might need a deposit to rent a home or apartment after your divorce. If you haven’t started saving for this yet, the time to do so is now.
  • Plan for an emergency: Some financial experts recommend having an emergency fund that can pay for three to six months of expenses. This can provide a critical cushion for a job loss, economic downturn, or other unforeseen event.

Securing Your Financial Future After Divorce

While divorce presents an immediate stressor in your life, you should never lose sight of your long-term financial well-being. Be sure to do the following:

  • Revisit retirement contributions and employer benefits: If you haven’t examined your retirement plan in a while, you should do so. Make sure you are taking advantage of employer-provided benefits you might have overlooked.
  • Develop an estate plan: A comprehensive estate plan can help you not only provide for your loved ones but also potentially assist with your retirement planning. While you are making your estate plan, be sure to update the named beneficiaries on life insurance and other accounts and remove your former spouse.
  • Consider further education and job training: You might need to return to school to attain the level of employment you require. Job training or retraining is another option.

Your Fresh Financial Start and the Importance of Legal Counsel

If you’ve never met with a financial planner, divorce may be the event that convinces you to do so. A planner can help you set a budget, meet short- and long-term goals, and set you on the path to financial independence and security.

Meanwhile, an attorney can represent your best interests before, during, and after divorce. A settlement agreement with beneficial terms can save you money and avoid protracted litigation.

If your divorce goes to court, your attorney can advocate for financially advantageous child support, alimony, and equitable distribution orders. Lastly, your attorney can assist you with modifying any orders you are unable to comply with after your divorce.

Contact Our Greenville Divorce Lawyers Today

The decisions you make now could impact you long after your marriage is over. Hiring knowledgeable legal counsel will help you manage your finances after divorce. Reach out to Elliott Frazier — Family, Personal Injury, & Car Accident Attorneys, LLC. We can schedule your initial consultation today.

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