Chapter 9 Facing the Future: What Must I Plan For?

• Library: Divorce & Money (Nolo) (2020 Ed.)

CHAPTER 9: Facing the Future: What Must I Plan For?

Major Upcoming Life Events

Anticipated Financial Commitments

Major Goals That Will Cost Money

Where Does the Money Come From?

If you're thinking about a divorce or beginning one, you might believe you see only problems ahead. Nevertheless, you need to begin changing your outlook from "we" to "me"—-from being part of a couple to being on your own.

It's helpful at an early stage to set basic goals for yourself. In most goal-setting exercises, you're asked to think about where you'd like to be in a few years—an effective approach for some people. In counseling divorcing clients, however, we've found it helpful to turn the question around. If you have trouble looking at the future, answer this:

Where don't you want to be five years from now?

Speaking financially, few of us want to be in debt, burdened with property we can't sell, or working two jobs just to survive. Yet that could happen to you if you drift through a divorce without planning ahead. By thinking about the kinds of financial problems you'd like to avoid, you can narrow your focus and clear the way for what you do want to accomplish.

As an initial planning exercise, use the columns in the chart that follows to jot down the immediate problems you foresee, as well as your goals. (Use the examples to give you ideas about your own needs.)

Once you have a basic idea of where you'd like to go in the future, take a few moments to reexamine where you are now. Use these questions to help you think about your own situation.

Major Upcoming Life Events

You can't predict the future, but there are major upcoming events that will affect what you will and will not be able to do with your money. Some you've anticipated for years. For instance, if your teenagers will begin college in a year or two, you may need a smaller house and a larger paycheck. Or perhaps you're reaching retirement and must prepare for living on a reduced income.

Other events, although not certainties, also warrant planning. If you're in an industry that's downsizing or a company that's being restructured, consider what it might cost to undertake a career shift or pursue more education. Even if you're young and healthy, you should carry insurance in case of an accident. If you have children, you should map out a support system that will kick in should you die suddenly or become incapacitated—consider the finances of these arrangements as well as maintenance of the children's overall well-being.

Whatever your situation, remember that a proactive approach is always better than a reactive one. When you anticipate and prepare for major financial events, you can increase your odds of staying afloat by having a backup plan in place to...