Divorce is expensive. Even an amicable divorce with simple assets simply costs money. People do not typically have savings earmarked for divorce so it requires them to spend savings that would otherwise be associated with other things or sell assets to come up with the money to afford their divorce.
People can make the financial stress worse in a few different ways that are good to be mindful of in case you see these flags being raised in your own divorce journey:
- Similar to people’s reaction to stress is to eat or drink more, some people go out and spend more to feel better. That sweater will make me feel better. That spa day is definitely deserved given all of this stress. I just need to run away to the mountains for a few days. Be careful about doing this and ending up stressed financially.
- Using credit cards in anticipation of a future settlement. Spending on future earnings is never a good idea. The 15-20% interest rate on most cards these days makes these expenses cost more than they are worth.
- For people that were tightly controlled financially by their spouses the newfound freedom of being able to spend what they want when they want can be very intoxicating. This “drunk” spending can be also very dangerous.
In general, have some patience and let the dust settle in your new world order before making any major purchase decisions for either experiences or physical things. Spending when you are in a suboptimal decision-making state, that is “divorce brain” is highly risky. Make a detailed budget for your new life that is realistic, which should include saving money, and then honestly see what you are able to spend on the more fun things in life. You will ultimately enjoy these things more when they do not bring the hangover of financial stress.
