Being newly single, one of the significant areas of your life that will be impacted is in the bank account. Divorce expenses, moving expenses, child support (existing or non-existing) childcare, insurance etc. are all expenses that have or will hit and hit hard. In this economy, nothing is getting less expensive in fact the opposite seems to be happening. Fuel and food costs continue to climb upward and most other expenses are not far behind. You may have transitioned from a two income family to a single income family. So how does one survive what could potentially appear to be economic disaster?
Well one of the least traumatic ways is to take it one step at a time. You don’t want to go on a financial crash diet, you need to make a plan that you can live with consistently. The first step it to make a new budget. Put all your bills and expenses out in the open and make a plan. If you’ve never done this before then take a class and learn. I remember a friend of mine that whenever we were in a grocery store she never looked at the prices of anything. If she wanted to get something, she just did. Years later after being divorced and on a much tighter income, it was a huge adjustment for her to have to start looking at prices and live within her means. She had never had to do that before. The first step with your budget is to get out of any denial that you might be in and face reality; it just might not be as it was before.
Once you figure out exactly what your income is and what all your expenditures are you are ready to make it work. Obviously, if your outgo is more than your income you will have to make some adjustments. How you make those adjustments is the key. Make a list of the expenditures that are absolutely necessary and the ones that are negotiable. Involve yours kids in the process when possible so that they understand the changes that will affect their lives. You don’t want them to be fearful, just aware.
Slowly start to eliminate the least priority expenditures. Do not fall into the trap however of eliminating everything but the bare essentials; that is a financial crash diet! Even dieters need treats now and then so make sure that you work funds into your budget for occasional entertainment and special events.
Above all, make sure that no matter how tight your income might be, set aside a small amount for savings and emergencies. Where most people get into trouble financially is when they do not have a contingency plan for emergencies and unexpected expenditures. With no planning for this, they will have to dip into their bill money and that is what will throw their finances into the game of ‘catch up’. There will always be car repairs, broken water heaters, medical co-pays, unexpected dental emergencies, etc. You want to have something set aside for these times which come into everyone’s life.
Just remember that a budget doesn’t work unless you work it. You will have to discipline yourself to not stop off at a fast food joint when you are too tired to cook and eat at home. Throw away the Macy’s sale paper and start clipping coupons if you need to. You do whatever you have to do because your children are depending on you. Whatever your plan, do it together with your family. You will be surprised how kids will rise to the occasion when they have an understanding of what is going on. Pride will get you nowhere so always be honest with them. Remember, money does not replace love so as long as you are rich in that area, you’ll be fine.