Be careful of overspending during your divorce

One of the most significant issues that many people who go through a divorce will ultimately encounter is a cash crunch. This happens to many of us when we have more months left at the end of our money. Inflation being a major economic factor also is something that we need to be mindful of without getting too deep into that type of discussion. The point that I am trying to make is that it is easy to overspend for various reasons. When we have an ongoing issue like a divorce to pay for this overspending can be especially disastrous.

Trying to figure out how to spend your money is a tough ask of yourself as you stare down your divorce. There is going to be so much going on around you that it can seem like a hurricane is forming outside your door. Trying to batten down the hatches and learn how to spend and save can be a challenge unlike any other. Saving money while spending money on divorce may seem like the ultimate oxymoron. In short, this is not going to be easy and will be focused just as much on the personal finance side of things versus the legal strategy side of things.

Personal finances- it’s not all math!

One of the great misnomers about personal finances is that most of the difficulty associated with it is due to our collective unwillingness to embrace the math behind the problem. We aren’t big fans of spreadsheets and budgets, so it’s got to be the math to blame and not much more, right? Wrong. I am here to tell you that budgeting, personal finances and the rest of the material on this subject is about 80% behavior related and only about 20% math related. This can be distressing to find out. I think many of us hide behind our deficiencies in math only due to the heavy emphasis that is put on all of us to assume that budgeting is out of our control due to the math that is involved in the process.

This is not the case. Not only is math not a major factor in budgeting, but it also pales in comparison to how important something like personal decision-making and self-control is when it comes to budgeting and being able to control our spending. It’s like eating better and trying to lose weight. We can read all the books and blogs in the world but if we have no self-control, we have exactly zero chance of losing weight. The same can be said about personal finances. You will never get ahead in personal finances without first figuring out how to control your behavior. For some of us that may be even trickier than learning how to do the math.

Where does this leave you as you contemplate divorce? Are you ready to take on the monumental challenge of behavior modification? Telling yourself “No” is not easy especially when you are going through a divorce. You probably feel like the world is pulling at you in so many directions at once that you cannot keep track of things. The reality is that this is the first thing that you must come to grips with as you attempt to not overspend during a divorce. This is a goal that may be easier said than done. A divorce is one of those areas where you can trick yourself into thinking that any spending you do is justified given your circumstances. I’m doing it for my future or I’m doing it for my kids can be common justifications that you use on yourselves. That could be related to spending within and outside the divorce, alike.

These are just that, though- justifications. We justify our actions based on things we can’t control. If you take away anything from this blog post it should be that you absolutely can control how you approach subjects like this. Budgeting and personal finances are well within your control. You can do it. I can’t do it for you, but you can do it for yourself.’ Read on to learn how to not overspend in a divorce. I can promise you we are going to be light on the math and heavy on the creativity when it comes to figuring out the finances associated with a divorce.

Where to begin in a divorce from a personal finance perspective

Keep it simple. Look at your checking account, your savings, and your debt, and do an analysis. Preferably you will be in a position where you have no debt heading into a divorce. A mortgage is ok, but any consumer debt should be at a minimum if you have already started your divorce do not start to pay off large chunks of debt. That would be community income that you would be used to pay the debt and your spouse may not be as excited as you to use the debt for that purpose. Secondly, you may not even end up with that debt in your divorce when the case is all said and done. Since there are so many factors that are not yet decided in your case you are better off just letting sleeping dogs lie and taking the debt after your divorce has come to an end. Otherwise, see how much debt you can pay off quickly before you file for divorce. It will make your life easier when the payments associated with your case come to the forefront.

Budgeting can be your best friend during a divorce

The largest payment associated with a divorce will be on your attorney. You may have certain parts of your case that are unique but for most people who are reading this blog post, it is straightforward to say that you can expect your attorney bill to be the most significant expenditure that you encounter throughout your case. For that reason, you can and should consider two things: 1) whether you need to hire a lawyer and 2) how much you can afford to spend on a lawyer. Let’s go through both of these issues together.

You are not required to have an attorney represent you in a divorce case. Most people do end up hiring an attorney for one reason or another, but you are not going to be ordered by a judge to hire a lawyer. It may be in your best interests to do so but whether you hire a lawyer is going to be up to you. It can be a tough decision, that of hiring a lawyer. It takes a huge financial investment to hire a lawyer. Between a retainer and the hourly fees, the costs of hiring an attorney can add up quickly. During a time when you may be struggling financially, this can see as one more cost that could sink your already shaky budget.

With that said, it is a short-term investment that you are making into your attorney. This is not going to be an ongoing cost for you, most likely. You will hire a lawyer and he or she will represent you in the divorce proceedings. You will pay the lawyer and that will be that. The idea that most people will then keep a lawyer “on retainer” is a myth that comes up in movies more than it does in real life. You are likely to not have to see the lawyer again or at least not see him again for years until a modification or enforcement of the original order becomes necessary in the eyes of you or your spouse.

When we talk about the “need” for a lawyer I would look to the specific circumstances of your case. Do you have children? Do you own a great deal of property that will need to be divided in the divorce? These are the next two questions that you should ask yourself when considering whether to hire an attorney for your case. People who go through a divorce with children and/or a significant amount of property have more complicated divorces and therefore have more to lose by not hiring an attorney. Consider this as you are planning for your case. Even if you have no property to divide but have children it still may be in your best interests to hire a lawyer. Your children and your relationship with them are a huge part of your life and if you are not confident in your ability to represent yourself the only alternative is to seek out an attorney.

When you are considering whether to hire an attorney you need to seriously think about the time that you have available to you for preparing for your case. If you work a full-time job, and have a family and other responsibilities already on your plate then it is not a great idea for you to not hire a lawyer for your divorce. That’s not to say that you don’t have smarts or the wherewithal to represent yourself. Rather, it is an acknowledgment that all of us have limitations, and is one of them. You need time to be able to adequately prepare for your divorce. Whether it be mediation, a hearing or simply responding to discovery. Planning to burn the midnight oil and attend to all these matters after everyone goes to bed at night is not necessarily the great plan that you think it is. Rather, sleep ends up winning the day often leaving you holding the bag when it comes to unfinished work and preparation for your case.

Once you conclude about whether to hire a lawyer for your divorce the next question that you need to ask yourself is how much money you should spend on a lawyer. Lawyers are like any other product or service available to you in the marketplace. You can price yourself into and out of the consideration for many attorneys around town. Fortunately, one factor working in your favor is that there are a lot of family law attorneys around Houston. Usually when the quantity increases, the price decreases. If there was only one family law attorney in Houston, you can bet he or she would charge out the wazoo for their services.

First, you should consider hiring a family law attorney for your divorce. This may sound like a no-brainer, but you would be surprised to learn that some people hire general practice attorneys to represent them in a divorce. This is done as a favor to the lawyer because he or she is a friend or because he or she was referred by a friend. In whatever situation you find yourself in right now it is wise to think seriously about only hiring an attorney who can say that he or she practices only or primarily in family law. Hiring another kind of lawyer to represent you in a divorce would be like hiring a Honda mechanic to fix your Ford truck. Sure, the Honda mechanic could probably figure it out eventually, but you need to get on the road now, not in a week. The same thing applies to divorce. You don’t want to be the lawyer’s test case where he or she learns how to practice family law on the fly in your case. Rather, you want your lawyer to hit the ground running with no unnecessary delays in your case. There is a certain amount of institutional knowledge that comes with practicing family law for an extended period. Take that knowledge and protect your interests at the same time.

Once you have determined that you want to hire a family law attorney for your divorce then you should start to figure out a budget for yourself. You know how much wiggle room you have in your budget each month to hire an attorney. You may also be putting the lawyer on a credit card or other payment plan structure. If this is what you want to do then the big thing that you need to consider is that having a plan on how to pay the lawyer eventually is going to be essential to having a good experience in a divorce. Do not assume that you will just be able it on the fly. Unforeseen costs and expenses will likely come out of your divorce rather than costs being taken away by an attorney. With that said, you should think more about how you are going to pay the lawyer before you hire one.

Hiring a lawyer on a budget means thinking about the subject rather than making split-second decisions. You can do some online research, go to speak to the attorney in person if he or she offers free-of-charge consultations (like the Law Office of Bryan Fagan does), or ask for referrals to call someone who may be willing to discuss their experience with the attorney. You should consider the different costs and your comfort level with the lawyer. It will be difficult to determine the sort of legal services an attorney can provide you with as far as caliber and quality of representation are concerned. Most attorneys look competent and talk a good game. That is where asking questions and referrals can help you out.

How to not overspend during a divorce? Control the person in the mirror

If I could better control the person in the mirror, I would probably be a few pounds lighter and have a few more dollars in my pocket. The problem I have with self-control is probably the same problem that you have with self-control. It is easy to talk about controlling your behavior, but it is tough to follow through and do it. We see people every day with the law office of Bryan Fagan come into our office who ask great questions and have deserving cases. These are the people that we take pride in representing. We hope that we can provide you with information in this blog post and others where you will feel confident to hire our office for your legal needs.

The best piece of advice that I can give when it comes to spending and budgeting is that having a budget helps a great deal. A budget does not restrict your spending. The budget permits you to spend because when you have a budget you know where your money is going before it is spent. When you lack budget money goes out the door before you can even figure out where it’s headed. If your money does these enough times to you then you are in a position where you are likely to waste money that could be better spent on things that are more important to you.

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