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Rebuilding Your Wealth When Divorce Makes You Broke

By Danielle Miura February 08, 2023 Managing Money

On top of the emotional roller coaster of a divorce, it can also be costly. According to Nolo, the average cost of a divorce is $10.6k, which can take a substantial amount of money out of your pocket.

Don’t lose hope if you’ve recently been through a divorce and have a limited amount of money. It may seem challenging to start over, but it’s possible. Here are some tips to help you rebuild your life with no money after a divorce.

First, Take Time to Recover Psychologically

Divorce is a pivotal moment that can take you quite a while to adjust to. Therefore, it is vital to take time to process and grieve after your divorce. There’s no one-size-fits-all timeline to heal emotionally from a divorce; it is okay to feel various emotions.

Remember that your well-being is the most important. Lean on your support system to get through these challenging times. If you don’t have family or friends to rely on, there are plenty of online support groups that you can lean on for advice and share common feelings.

Make a New Financial Plan

Since your lifestyle and financial situation will shift after a divorce, it’s time to reevaluate your financial circumstances and goals for the future. Here are some tips to start your new financial plan.

Take Inventory of Your Assets and Debts

Take stock of where you are right now in your financial journey. Next, list your assets and liabilities, including savings, credit card debt, investments, or a home. If you have obligations, list them from highest to lowest interest rates, this will help you determine which debts need to be paid off first. Now that you have all your assets and debts listed, you can use it as a starting point to better gauge your financial position.

Build an Emergency Fund

Start rebuilding your finances by creating an emergency fund. An emergency fund will include 3 to 6 months’ worth of expenses to pay for care or home expenses and use as income if you lose your job or have a significant health bill. In addition, an emergency fund prevents you from credit card debt, selling your investments at the wrong time, and acquiring more stress.

Look for Financial Support from the Government

Starting over with no job or place to live can be depressing. However, government assistance programs can assist you with getting back on your feet through job assistance, health insurance, housing, income assistance, and food stamps.

Determine Your Health Insurance

If you had health insurance through your ex-spouse’s employer, you might lose it when you’re divorced. First, check to see if you qualify for COBRA. COBRA is the program that allows you to keep your health insurance for a limited time after your divorce. COBRA can be more expensive than government or marketplace insurance options, so compare your coverage and price before selecting the best option.

Move in with Family

If you don’t qualify for government benefits or are waiting for benefits to start, consider moving back in with a parent or a family member. This may be challenging; however, it’s sometimes necessary. Instead of considering it a step backward, consider it a temporary move that can help you save enough money to start over again.

Decide Whether to Buy or Rent

Your rent or mortgage will be your highest monthly expenditure. Consider your budget. If you are still determining where you would like to live after divorce or plan to move soon, selling a home and moving might be costly. Renting is usually better when you start rebuilding your life after divorce.

Strengthen Your Credit Score

Start with a free credit card report to get a clean slate. Your credit card report can help you determine if there are any errors or signs of fraud. If you find any discrepancies, dispute them with the credit bureaus.

Then, focus on paying down debt and increasing your credit score by paying your bills on time, keeping your credit utilization low, and having a mix of different types of credit. It is also an excellent time to put a system in place to protect you from identity theft, like locking credits you are not using and shedding old documents.

Sell Unwanted Items

After the divorce, items are usually awarded to you in the settlement that brings you bad memories. Instead, convert stuff you owned in your previous marriage to cash by selling them online through garage sales, online marketplaces, or local pawnshops. The money you gain can help boost your savings as you start a new chapter in your life.

Get Organized

Going through a divorce is very complex. So naturally, one of the last things on your mind is getting your finances in order. But it is essential to do so as soon as possible. So here are some tips on how to get organized after a divorce.

  • Create a budget and stick with it.
  • Catch up with recent or past-due bills.
  • Update names on bills and accounts.
  • Update your beneficiaries on your accounts and insurance policies.

Bottom Line

For many women, starting over after a divorce can be challenging, especially if you don’t usually manage your finances or have limited resources. However, remember that you don’t have to do it alone. Finding a financial team and creating a plan can help you become stronger and more financially stable than before your divorce.

Let’s Have a Conversation:

What are your financial tips for rebuilding your life after divorce? What do you wish you knew about the divorce process before filing?

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Lisa Stege

Make sure that you aren’t liable for any joint accounts. When I left my last marriage under duress, I put most of my belongings in storage and rented a room in someone’s home for awhile to catch up on financial obligations. It enabled me to recover more quickly, and having other people in the household made me feel more secure.

The Author

Danielle Miura, CFP®, is the founder of Spark Financials, a Fee-Only Financial Planning Firm focused on serving the needs of caregiving families nationwide. Danielle specializes in comprehensive financial planning, financial education, and tax law research. Find out more at and contact her at

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