If you are getting a divorce and have a child, by definition, you will be a single parent for at least a period of time. In fact, the fastest you can re-marry after your divorce is thirty days. For most of you reading this blog, you will be single parents for much longer than thirty days. Many people choose never to re-marry, and more still choose to never seriously date after their divorce. Whatever situation you find yourself in, parenting after the divorce can seem like a daunting task.
Fortunately, you have options available to you. While nobody would tell you that divorce is easy, there are certain things you can do to set yourself up well for life after your divorce has concluded. In today’s blog post from the Law Office of Bryan Fagan, I am going to share with you some of my thoughts on this subject.
Make monthly savings something that happens automatically
If you let money sit in your checking account for too long, the temptation is to spend it on something that you and your family does not need. We should all do our best to have a rainy day fund that will help us make it through times of the month where money is tight. For instance, if you have to pay to get some repairs done to the air conditioner in your home how would you do so? If you are like most people, this would require that you take out your credit card and put the repairs on your card. Very few people are able to pay for a $2,000 repair to their air conditioning system by using their savings.
That does not mean that you should give up on being able to do this. For instance, I recommend that if money is tight in your household after the divorce that you should devote whatever income you have towards paying the essentials for you and your family: rent/mortgage, food, water, lights, and gas for your vehicle. Everything else can take a backseat. It can be intimidating for you to have to go through life as a single parent and have bill collectors and creditors constantly calling you to see when your next payment is coming.
You should not be intimidated by these people. Ultimately you should think about the needs of your family before paying down debt. The debts will always be there but the needs of your family come first. However, you can begin to save money by taking a small step like automatically having money go from your checking account to your savings account on the first of each month. This way you will be saving before you ever have a chance to spend the money elsewhere.
Taking the decision out of your hands and getting it done automatically is one of the best things you can do for yourself. You have enough to be worried about before thinking about having to save money for a rainy day. This same advice can be applied to bigger picture items like investing for your retirement and saving towards your children’s college education. You can set up investment accounts that are automatically paid into each month from your checking. One less thing to think about and one less thing for you to be tempting to spend money from.
Another thing you can do is set up your bills to be paid automatically. This may seem like a no brainer to the younger people reading this blog, but to the rest of us, automatic payments don’t come so naturally to us. You may be used to taking a bill from the mailbox and sitting down with the checkbook to pay it. Stamps, envelops and balancing the checkbook are a part of your life.
What if I told you that it didn’t have to be that way. That, if you choose, your utility bill could be paid on the first of the month simply by setting it up on your bank’s website. It is not only possible, but advisable. Look for opportunities to pay your bills online and to do so automatically. I bet you’ll never look back.
Look for deals where you can find them
However, when you do have to spend money you should use whatever time and resources are available to you in order to look for deals. Sales happen all the time in the brick and mortar stores that we frequent. However, when you are in need of purchasing items for you and your family you should look at websites that can offer you discounts.
This can start even at the grocery store. I know there is a large chain of grocery stores here in the Houston area that offers deals through their website if you check it once in a while. Again, this will take a little bit of planning and effort. But the effort can result in some big bucks in savings for you and your family.
If you plan ahead you will be able to consider only the items that you need. It is usually when we are shopping aimlessly that we come across items that we don’t really need and eventually purchase. By planning meals ahead of time I bet you will stick to your list much better, save money and ultimately have more money for saving and investing. Last week we talked about budgeting and how it can actually feel like you have more money than you thought. This is because you are going to be assigning every dollar you have to do something specific rather than wasting money on things you do not need.
Get yourself on health insurance of some sort as soon as possible
All the saving and coupon clipping in the world will not save your financial life from a medical issue that is not covered by health insurance. There is more access for everyday Americans to quality healthcare now than at any time in our nation’s history. What you need to do is find a plan that takes into account the needs that you have as far as your health is concerned. You can shop online, from your employer or even from government plans that can provide you with varying levels of coverage.
More people have to file for bankruptcy due to medical bills than for any other reason that I am aware of. Unpaid medical bills happen when people are not covered by insurance. Do not put yourself in a position where you are unable to work, incur medical bills and are unable to pay those bills. You can make a lot of good decisions elsewhere in your life, but if you do not get yourself covered by health insurance then all of those good decisions can be undone by one, big bad decision.
Long Term Disability (LTD), Short Term Disability (STD) and Long Term Care (LTC) Insurance
Speaking of insurance, there are additional insurances that may be available to you at reasonable rates. These types of insurance are ones that can leave you in a much better position if you go ahead and purchase them.
For starters, long term disability (LTD) insurance is a type of policy that would cover a portion of your income on a monthly basis in the event that you are found to be disabled and cannot work. Premiums (depending on the amount of coverage you request) can be under $1,000 per year. I realize that the amount of money you have to spend on these types of insurance may be limited but it warrants mentioning that insurance covering your income could be all that stands between you and your family from facing significant financial difficulties.
Short Term Disability (STD) is typically offered through your employer and would allow you remain out of work for a short period of time and be paid a portion (percentage) of your income. Short term disability benefits can be especially helpful if you will not have an ongoing disabling condition that affects you moving into the future. Check with your employer on the availability of STD insurance and see what the monthly rate for the insurance would be.
Finally, long term care insurance (LTC) is available for persons who want to protect themselves against the costs associated with nursing home and at home care. Persons in their late 50s and early 60s may want to look into the availability of long term care insurance. LTC pays money towards skilled nursing care at home or nursing care in an actually nursing home if you do not have the money to spend on nursing home or assisted living care. You can choose the length of time that the policy pays benefits (usually 3-5 years) as well as the amount of money that is paid on a yearly basis.
Some of these type of policies are available through your employer while others may be offered through your car insurance provider. You should inquire as to their coverage amounts, premium costs and any other relevant costs associated with coverage. If you are not getting favorable rates or just want to know more about your options, you can search online for an insurance broker who can help you to select the plan that’s right for you.
Don’t take it easy at work and use the divorce as your excuse
I get that your work may not be at the top of your priorities list immediately after your divorce has been finalized. However, the money and benefits that you earn at your job probably are. Nothing that we have talked about so far today in our blog post can be achieved without an income. Your best chance to pay down debt, save for your child’s college education, save for your own retirement and eventually pay off your home mortgage is to conserve your income.
Since your income is your ticket to a better life, you need to do what you can to succeed at work and find some amount of fulfillment in what you do. I can appreciate your mindset of being a little jaded, a little cynical about work right after you spent large chunks of your income divorcing your spouse. It would be easy for me to tell you to take care of yourself and worry about tomorrow another time.
However, that would be irresponsible of me. You didn’t go through the hardships of a divorce only to put yourself right back in deep and murky waters- financially speaking. Be careful that your performance and attendance at work does not begin to slip in the time period immediately after your divorce. If you work a salaried job, that doesn’t mean that you have more job security than an hourly employee. We are only as good as our last performance review. Work your hardest at all times. Actually, work when you are at work (leave your cell phone in the car or at the bottom of your desk drawer). Put as much effort into the job as you put into complaining about your co-workers.
Do things that other people at work struggle to do. For example, if your supervisor asks for volunteers to take an extra shift or to do something that is seen as undesirable you should take note if not many people leap at the opportunity to fill one of these roles. If nobody raises their hand, yours should shoot up in the air. You will become invaluable to your employer if you do your job well and are willing to step into roles that nobody else is willing to fill.
Questions about today’s blog post? Contact the Law Office of Bryan Fagan
If you have any questions about the material that we wrote about in today’s blog post please do not hesitate to contact the Law Office of Bryan Fagan. Our licensed family law attorneys offer free of charge consultations six days a week here in our office. We work in the family law courts of southeast Texas on behalf of our neighbors every day. The successes of our clients are what drives us to do the best we can- day in and day out.