Like many aspects of divorce, managing your finances after splitting up with your spouse can feel complicated and overwhelming. This is true whether the separation is amicable or acrimonious. Because every divorce is different, it’s wise to consult with your attorney and financial advisor for guidance, but here is a basic primer to help you navigate your finances independently from your ex-spouse.

Adjust your budget to match your current lifestyle

Start by calculating your new monthly income, including spousal or child support if applicable, and estimate what you expect to earn over the next year. If you are a stay-at-home parent or spouse, you may decide to re-enter the workforce to bolster your income. Or the time may be right to switch careers or seek a side hustle. 

Next, look at your spending to see if you need to adjust your patterns. Whether you’ve decided to remain in your home or seek new living arrangements, crunch the numbers to see how much house you can realistically afford. Also, evaluate your lifestyle spending, including entertainment, dining out, and vacations, to see if it’s necessary to trim your expenses. If possible, avoid making any major purchases until you feel comfortable with your updated budget. 

Consider your children’s future

If you have children, they will understandably take center stage in your planning. It’s important to start thinking about how you’ll handle future financial milestones. Milestones may include paying for private grade school, college tuition, the down payment on a home, or a wedding. If you’d like to help your children with such expenses, consider these questions: Will you receive financial support from your former spouse? Do you expect your kids to contribute? As each event approaches, be up front with your kids about what you can afford so they can set realistic expectations. 

Prioritize saving for retirement

No matter how close – or far – you are to retirement, make it a priority to update your retirement goals and continue building your nest egg. You are responsible for your own savings. In fact, the biggest challenge most Americans face financially is having enough money to cover what could be several decades of expenses in retirement. While retirement saving can feel overwhelming as you balance competing financial priorities, having a plan can help you feel more in control. 

Ensure you’re protected

An important step following divorce is to maintain, replace or establish insurance that will help secure your financial future. All forms of insurance should be reviewed and considered, and your beneficiaries should be updated if needed. Make sure you understand the specific benefits that you and your former spouse are entitled to through your employers, as well as applicable life, health and disability insurance policies. If you have children, whose health insurance plan will be used to cover them? Work quickly to establish an insurance plan to avoid the financial risk of being uninsured. 

Consider the tax implications of your new marital status

Review your situation with a tax professional to see if you need to revise your tax strategy. Divorce can affect your tax situation in several ways. Impacts may include entering a different income tax bracket, providing or receiving child or spousal support, and changes to your investment strategy and your process for handling future tax returns. 

Dream and plan for the future

Once you have a handle on your new day-to-day finances and retirement goals, allow yourself to dream and plan for other milestones that are important to you. Do you wish to visit every continent? Pay off your mortgage before retirement? Open a small business? Whatever your dreams, determine the cost of each one so you know how much you’ll need to save. Save what you can each month, and keep in mind that even small amounts will add up over time. If you’re tempted to spend the money elsewhere, consider establishing a separate savings account. 

Don’t go it alone

Professional guidance from an attorney, tax professional, estate planner and financial advisor can help you make empowered choices that match your new priorities.  Financial advisors like myself routinely advise clients on how to navigate with the complex decisions that arise during a divorce and offer strategies designed to help you meet new financial goals.

Daniel P. Morrissey, CFP®, CFS®, CRPCTM, is a Private Wealth Advisor with Heartland Wealth Advisors a private wealth advisory practice of Ameriprise Financial Services, LLC. in Lebanon, Pennsylvania.  He specializes in fee-based financial planning and asset management strategies and has been in practice for 40. To contact him, go to or call (717) 270-6937 at 1536 Cornwall Road, Lebanon, PA 17042.

Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the CFP® certification mark, the CERTIFIED FINANCIAL PLANNER™ certification mark, and the CFP® certification mark (with plaque design) logo in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.   

Ameriprise Financial, Inc. and its affiliates do not offer tax or legal advice. Consumers should consult with their tax advisor or attorney regarding their specific situation.     

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