Why create a budget?

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Why create a budget? Knowing what you need to live on will help you make realistic financial agreements as part of your divorce.

If you don’t know what you need to live on in the future, you won’t know whether what you’re being offered in a financial settlement is realistic or fair. Making a list of your essential living costs will help you make decisions like; is it possible to live on what I’m being offered, do I need to work more hours, change jobs or move to a less expensive part of town? Creating a budget can help you and your ex understand whether each of you needs more capital from a settlement or more cash support for example.

It’s important to be realistic when it comes to budgeting. It’s rarely possible to squeeze enough out of your existing assets to make both of you comfortable and totally secure. There are always changes in lifestyle that need to be accommodated and time spent in ‘financial recovery’ post-separation. Knowing your outcomes and incomings gives you the best chance of planning for a more secure future. Additionally, it ensures you can both meet the needs of any children you have.

If you have any questions or would like some support, please book a free 15-minute call with one of our experts here.

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