Making sure you’ve got a complete post-divorce budget is an important part of starting the divorce process.
Start with the Utilities
First things first: let’s start with the utilities. Most people have gas, electric, phone bills, internet, water, trash, and sewage. You likely have car insurance, rent/mortgage, and health insurance. If you’re renting, your renter’s insurance will probably be paid separately from your rent. For most people, the electric bill and the gas bill will have the most variance. Generally, in the warmer months, you will have a higher electricity bill while in the colder months you’ll have a higher gas bill. You can get a general idea of what your gas and electric bills will look like by reviewing the past year of statements online. If you moved to a new house, the data you have on your old residence may still be useful. However, you’ll need to keep in mind that your bill can change based on the size and location of your new home.
Don’t forget to budget for your car payment, if you have one. You’ll need to consider how much driving you’re doing, as well as how much gas you’re going to use per month. Keep an eye on the gas prices as they can fluctuate a good amount. It’s likely in your best interest to adjust your gas budget based on current driving trends and gas prices. Don’t forget about your registration and inspections either. Although these only come once a year, it’s in your best interest to budget for them instead of pulling from your savings account to cover the cost. Depending on how much you drive, you may want to budget for a couple of oil changes per year.
Financially speaking, shopping without a grocery list is risky. But before you can make your grocery list, you need to have a solid meal plan in place. For many people, this means does mean eating leftovers. One adult can probably get by with cooking only three to four meals per week. Once you compile all the recipes you’re going to use, it’s time to make a grocery list based on the ingredients you’ll need. If you’re not used to cooking at home, you may not have many of these ingredients on hand. In that case, it may be beneficial to pick recipes for the week that use the same ingredients until you have a lot of ingredients built up. If a person is really dedicated to saving on groceries and eating at home, it is possible for one adult to subsist on around $150 per month for groceries.
Household Items and Personal Care Products
Although you probably won’t need them every month, you will need cleaning supplies. Some of the items that most people use include glass cleaner, bleach, toilet bowl cleaner, all purpose cleaner, dish soap, and laundry detergent. You may need to purchase a vacuum cleaner if your ex ended up with the vacuum cleaner. Shampoo, conditioner, face wash, feminine hygiene products, toilet paper, and body wash often tend to get forgotten during the budgeting process. Make sure your monthly budget includes these items. Buying these items in bulk when you have extra financial resources may help you stay on top of your expenses in the long run.
Memberships and Subscriptions
When you’re making your monthly budget, it’s a good time to consider all of your monthly memberships and subscriptions. This is a place where you can save big, especially if you have memberships and subscriptions that you don’t regularly use. By cutting back on unnecessary subscriptions, you’ll be able to free up more money to spend on things that you love. Even if a $10 monthly subscription doesn’t sound like a whole lot to you, having five $10 subscriptions per month can really add up. It’s always a good idea to be mindful of the services you’re subscribing to, especially if you know that you could use that money on other items.
Debt and Other Obligations
Your budget should also include all your debt: all credit card payments, settlement payments, student loan payments, etc. If you have child support payments or alimony payments, you need to make sure that those are included in your budget. If a decisions regarding child support and alimony have not officially been made, you should still include them in your budget if either obligation is a possibility. If you are struggling to make the minimum payments, you may need to consider meeting with a credit counselor to get advice on getting out of debt. Make sure you’re working with a non-profit agency that’s dedicated to helping you succeed.
Savings and Miscellaneous
Last but not least, it’s important to have a savings and a miscellaneous fund for each month. Your savings will be the amount of money you’re putting away for retirement, the miscellaneous will be a fund for when stuff happens that was rather unexpected. Many people find it easy to think of the miscellaneous as a margin of error. How much you set for this will depend on your lifestyle. But if you notice that you’re consistently spending a lot of your money due to the margin of error, it may be time to adjust the budget. Your savings account should not be a rainy day fund that you use to fund emergencies or vacations. Although some emergencies are best covered by the savings account, that should not necessarily be the plan.
When You’re Considering Divorce
If you’re ready to get divorced, CoilLaw is here for you. Although many people find the divorce process to be overwhelming, having an attorney who has a good understanding of the divorce process can make all the difference. If you’re ready to get divorced, contact CoilLaw to set up your initial consultation.