Divorce often brings about significant financial changes. One of the primary concerns for those going through a divorce in Ohio is how to maintain their current standard of living post-separation.
While the process can be emotionally and financially draining, there are practical steps you can take to help ensure you continue to enjoy the same quality of life.
1. Post-divorce budget
Start by creating a detailed budget that reflects your post-divorce financial reality. List your income, expenses and any changes you anticipate. This will help you gain a clear understanding of your financial situation and enable you to make informed decisions.
2. Financial goals
The median household income in Ohio is $61,938, and that can decrease drastically after a divorce. Identify your financial goals and prioritize them to allocate your resources effectively. This could include maintaining your current home, providing for your children’s education or building an emergency fund.
3. Assets and debts
Carefully examine your assets and debts, including property, investments and liabilities. Be aware of any potential tax implications related to asset transfers.
4. Housing situation
Housing is often a significant expense. Evaluate whether keeping the family home is financially feasible or if it is more sensible to downsize or rent a more affordable residence. Make this decision based on your budget and long-term goals.
5. Alimony and child support
Ohio guidelines base child support and spousal support (alimony) on various factors, including income and earning potential. Advocate for a fair arrangement if applicable in your case.
If you receive a portion of your marital assets in the divorce settlement, consider how to invest them wisely to secure your financial future. Consult with a financial advisor to make informed investment choices.
7. Emergency fund
Establish an emergency fund that could replace three to six months’ worth of income to cover unexpected expenses or financial emergencies. Having a safety net can prevent you from going into debt when unexpected costs arise. If you cannot afford to save a substantial amount initially, begin with a small, manageable contribution and gradually increase it as your financial situation changes.
8. Insurance coverage
Review and update your insurance policies, including health, auto and life. If necessary, obtain the pertinent coverage to protect your assets and financial well-being.
With careful planning and financial management, you may be able to maintain your current standard of living in Ohio.