Divorce is one of the most traumatic events life can dish out. Some couple get through it as friends, but many have the hate and hurt overwhelm the situation. Obviously, try to come back to a new normal and don’t let the hate and revenge canker you. That’s easier said than done.
Financially you need to assess where your income is going to come from. Child support, alimony, your own work, government assistance. You have got to think of a budget that is realistic based on your new income scenario. Decide if it is possible for you to go get a job. That will depend on the children situation. (This article assumes you have dependent children and some assets).
There is no question you have taken a financial hit, in all likelihood. In many cases that puts you below the poverty level. You may be doing ok and think you can survive, but you are below what the government thinks is poverty. That makes you eligible for a number of government assistance programs.
One way of looking at life is to say that your job is to stay home and raise your family. It is much harder to raise children in a single parent home, but you can do it. Look at the government assistance programs. They can help keep you at home with the kids. You can look at the government assistance as a way of investing in your children. If you can be in the home and really raise great kids, that is a big contribution to society, and it is worth the money society spends to make sure it happens. Bad citizens will cost society more in the long run than the money spent helping you raise good citizens.
Programs such as food stamps, CHIP, Medicaid, school lunch, heating/electricity subsidy programs, general welfare, and many others are available. There is definitely a science to working with the programs. The question is, do you want to go that direction? You certainly don’t need to be shamed by your choice of taking government assistance and staying home to help your children. The stress of the divorce may have put such a burden on you, that your mental health may be better served staying at home for a while.
What financial support will you get from your Ex? Who pays for the insurance? Most all of this should be outlined in the divorce decree. If it isn’t in the divorce decree, then it is a rare Ex that will contribute anything else to you or the children. Will your children be able to contribute to the family’s financial support? Is there any support from your extended family? Your parents may be in a position to help your children.
You need to review your insurance. Auto, home, medical, life insurance, and other insurance policies all need to be reviewed and updated. Make sure you change beneficiaries on life insurance policies. Don’t go uninsured. It isn’t worth the risk. Name the children as beneficiaries of the life insurance policies or name your living revocable trust as the beneficiary.
Make sure deeds are updated. You’ll have to get your Ex to sign over his interest in the property that goes to you. That should have been done as part of the divorce. Getting his name off the mortgages is a bigger problem. The only way that can be done is to refinance the mortgage.
Check retirement plans and IRAs. Make sure you remove his name off as a beneficiary. Name the children as beneficiaries. If the children are minors, it would be better to name a living revocable trust as the beneficiary and have the children be beneficiaries of the living revocable trust. The new laws make it so the kids can’t “stretch” the IRA like they used to, so the trust is a viable alternative to be used as a beneficiary on retirement plans and IRAs.
The problem is the insurance policies and the retirement plans/IRAs will not pay out any money to a minor child. The family will have to get a court ordered guardian/conservator appointed before any money will be paid out from insurance policies or retirement plans on behalf of the children. If a living revocable trust is named as the beneficiary, the insurance companies and retirement plan/IRAs will pay out promptly to the living revocable trust.
You should at least consider getting a living revocable trust. It will protect the children and your finances if you were to die. The Ex, as the biological father, will have almost automatic guardianship over the children. You can write a will which appoints someone else as your first choice as guardian, and you can make an argument in the will as to why you want someone other than the Ex as the children’s guardian. Just give the FACTS! Don’t show emotion.
You can certainly make it so the Ex doesn’t get any money along with the kids. Have a living revocable trust that holds all your assets and names someone other than your Ex as the trustee. The trustee will control all the money for the kids, and your Ex will never see a dime. Money can be used by the trustee for the benefit of the kids directly. It is amazing how often the Ex doesn’t want the kids if there is no money attached.
You will start to build assets, and you need to manage those assets wisely. Don’t let anyone talk you into investing any funds you might get from the divorce. Just put the funds in a bank account and let them sit for a year. You aren’t thinking straight after the divorce and will often make financial decisions based on emotion rather than logic. After a year, you will be thinking straighter. Use a living revocable trust to hold your assets. It will protect them from probate when you die and move them to the children without any Ex involvement or use of the assets.
A single mother recently divorced with kids in tow, is really hard. Hopefully, you have your family around that can give you support (emotionally and financially), and hopefully you have a good set of friends. Being a divorced single mother is a really hard job. You can do it though.