Nov 17, 2021
Importance of Making a Budget Before Signing a Settlement Agreement
The word “budget” can be a scary term if you are a person who has trouble controlling their spending habits. When going through a divorce, it is important to use a budget plan to determine the fairness of a settlement agreement, as the size of the household income is being cut in half. Emotions and expectations can be a barrier to adequately addressing your personal needs for the present and future. It is crucial past experiences are put aside as you will be planning for your individual future. So, get out the accounting tools and focus on your needs rather than your wants.
Mike Routh, Esq., an Attorney at Alpha Center for Divorce Mediation, talks with Georganne Ford about the importance of making a budget before signing a settlement agreement.
Hopefully, during your child support and alimony negotiations, you started the calculation by looking at your gross income on a monthly or weekly basis. This is good place to start, but focus on your after tax amounts and whether there will be any income from other sources like a child support or alimony. Next, identify your expenses by looking at the costs associated with your new life as an individual rather than just cutting the marital expenses in half. It is also important to prioritize these expenses so you know where possible shortfalls might occur from lack of the second household income. This approach will help you create a budget to follow. If you stick with your plan, then your foray into this intimidating chapter of you new life will be successful.
If your work from above has been thorough, then you should have a general idea on whether the arrangements you have made in your settlement agreement will be fair to both parties. The Alpha Center focuses on a budget minded approach in their mediation program as the goal is to enable both parties to move forward amicably from the divorce. This is very beneficial when children are involved as the parties will be able to carry on the most important roles of being Mom and Dad.
Accepting guidance from a firm that specializes in the practice of divorce mediation will ensure a smooth path along the difficult road of divorce. Alpha’s multi-dimensional team can help you plan, budget and safeguard your financial future. Let our expertise help ensure the best possible outcome for you, your former spouse, and your family.