How to Get Your Finances Back on Track After a Divorce
Taking charge of your money after a divorce will feel daunting, especially when you're faced with a lower income. The key is tackling your to-do list in stages.


Last month, I wrote about a survey in which the Employee Benefit Research Institute interviewed retirees on how satisfied they are with their financial situation in retirement. Among the respondents, those who were separated or divorced were least satisfied with their financial well-being.
That’s not surprising when you consider that after divorce, “income drops for the vast majority of people,” says Stacy Francis, CEO of Francis Financial, in New York City. That’s especially true for women who were not the primary breadwinners in their households or had spent years out of the workforce.
Getting your finances back on track should start even before you sign the divorce papers. “People who come to grips with the divorce early in the process will be in a much better position afterwards,” says Lisa Zeiderman, managing partner at the law firm Miller Zeiderman, in New York City.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
That means staying on top of your finances so that, for example, you have credit in your own name, know where the money is, and are familiar with the divorce laws in your state.
And keep in mind that “the divorce doesn’t end when the decree is final,” says Leslie Thompson, cofounder and chief investment officer at Spectrum Financial Management, in Indianapolis. Thompson helps her clients work through details such as splitting assets and tax liabilities equitably, making sure that credit cards are paid off and joint accounts closed, and monitoring child-support payments. She recommends checking your credit reports for the next year to make sure no new credit has been opened jointly.
Create a budget and assess your net worth
Once you’re ready to begin your post-divorce life, take a deep breath and “take stock of your new situation,” says Francis. Draw up a budget that lets you live within what’s likely to be a lower income by listing all your sources of income and your expenses — even ones that are easy to overlook, such as the annual premium on your homeowners insurance or unexpected trips to the vet.
Next, tally up your assets and liabilities. If, as is likely, you find that your net worth is about half what it used to be, you may have to make up for lost time, especially when it comes to planning for retirement. Depending on your age, that could mean investing more aggressively in the stock market, taking advantage of catch-up contributions to retirement accounts starting at age 50 (and beefed-up contributions at ages 60 to 63), or working longer than you had planned.
Review your insurance policies and estate plan
Now that you’re on your own, you’ll need to review all your insurance policies: homeowners, auto and liability, as well as life insurance if you still have minor children and possibly long-term-care coverage for yourself. Finally, you’ll need to update your will and your estate plan. You probably don’t want your ex-spouse to be the beneficiary of your retirement accounts.
Overwhelmed? Francis recommends tackling one task at a time over the course of a year. For instance, get a handle on your budget during the first quarter, followed by retirement planning and investing in the second quarter, then insurance and your estate plan. You don’t have to go it alone; seek help from a financial adviser (find one at www.napfa.org) and an estate planning attorney.
One important member of your team could turn out to be an employment counselor or career coach to help you find the right fit to maximize your talents and income. “The biggest things under your control are the income you bring in and your spending,” says Francis. “Don’t let your own thinking put a ceiling on the possibilities.”
Janet Bodnar is editor at large of Kiplinger Personal Finance. Contact her at Janet.Bodnar@futurenet.com.
Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.
Related content
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Janet Bodnar is editor-at-large of Kiplinger's Personal Finance, a position she assumed after retiring as editor of the magazine after eight years at the helm. She is a nationally recognized expert on the subjects of women and money, children's and family finances, and financial literacy. She is the author of two books, Money Smart Women and Raising Money Smart Kids. As editor-at-large, she writes two popular columns for Kiplinger, "Money Smart Women" and "Living in Retirement." Bodnar is a graduate of St. Bonaventure University and is a member of its Board of Trustees. She received her master's degree from Columbia University, where she was also a Knight-Bagehot Fellow in Business and Economics Journalism.
-
‘My Etsy Shop is Dead’: Vendors Cry for Help Amid Trump’s Tariffs
Tariffs Small businesses are struggling to thrive as they absorb the Trump administration’s new wave of tariffs.
-
New HSA Contribution Limits Are Set for 2026: What to Know Now
Health Savings The IRS says Health Savings Account contribution limits will increase again next year due to inflation.
-
Six Ways to Use AI to Improve Your Financial Life
While they can't replace human advisers, AI-based tools can take some of the guesswork out of financial tasks — from budgeting to filing taxes and investing.
-
How the Social Security Administration Is Coping with Rapid Change
There has been a fair amount of change at the SSA since Trump took office. Here's a look at what's new this year and how it will impact the agency going forward.
-
REAL ID Alternatives to Fly Domestically
Alternative forms of ID to use at airports if you didn't get a REAL ID in time for the May 7 deadline.
-
Private Markets: Six Things Investors Can Learn From BlackRock's CEO
BlackRock's chief executive, Larry Fink, recently argued the case for increased access to private markets. Here's how a financial professional sees Fink's views translating into action for accredited investors.
-
What Is Term Life Insurance?
Term life insurance offers affordable coverage for a set period — here’s how it works and when it makes sense to buy a policy.
-
21 Countries the US Says You Shouldn't Travel To Right Now
Planning a trip abroad? The U.S. State Department advises Americans to avoid these 21 countries due to war, terrorism, and wrongful detention. Check the list before you book.
-
The Future of Opportunity Zones: Outlook for 2025 and Beyond
There are three potential paths forward for this innovative tax incentive program that's set to expire in 2026.
-
Have a Retirement Question? AI Can Answer That
AI is playing an increasing role in retirement planning. Here’s how some financial advisers are leveraging this new technology.