The holiday season can be a great time to share with, appreciate, and spend time with your loved ones. It can also be a great time of stress for some when they consider how much they have to spend, either on travel, gifts, and other holiday related expenses. The average U.S. household is expected to spend around $1,121 on gifts for the holidays in 2016.
The stress of spending during the holidays can be compounded when you are going through a divorce because the financial resources you previously had may be drastically reduced, or you may be restricted from spending it. The following financial tips for getting through the holiday season can actually be applicable throughout the year, and can help you adjust to your new financial reality more smoothly.
Learn to Budget
Creating a reasonable holiday budget for gifts and trips can be a great way to manage spending. It is important to make sure that your budget is realistic and does not rely on funds not yet in hand. For example, in making your holiday budget, it is best not to rely on tax refunds in the coming year to cover the purchases. Income levels may change after going through a divorce, and may take years to go back up. A budget throughout the year will also help manage your finances to absorb any unexpected divorce expenses, and prepare for the possibility of a reduced income and new monthly bills once the divorce is finalized.
Quality Time over Quantity
Plan to spend more quality time with your children during the holiday season, if there is no court order prohibiting this, instead of buying them numerous gifts. Children of parents who are going through a divorce may need to be reassured that even though things may change, they are still loved and protected. Some parents may try to show this through going overboard with gifts, or giving their children big ticket items. However, this is not wise, both for the child and the parents’ bank accounts.
Retail therapy can be tempting, especially with the numerous sales on offer this time of year. However, once the bills come in, it can be a sobering experience. While getting yourself a few gifts may be manageable, you should avoid making any large purchases such as a vehicle. Even if you need to make the purchase and want to take advantage of deals, make sure you take the time to think about the purchase, and take a cooling off period to ensure you are making the right decision for the right reasons.
Be Careful With Joint Assets
Funding holiday shopping with spousal joint assets before a court has made a final decision on how they are to be divided can cause legal issues for you down the road. While spending for necessities or reasonable gifts may be permissible, excessive spending may be considered wasting of joint assets and may be considered during the division of assets. Even if you anticipate a certain sum coming to you after the divorce, it is more prudent to wait until everything is finalized before spending it.
Contact An Experienced Attorney
Making sure you have the right legal representation during a divorce is as important as making sure you avoid financial pitfalls as you go through the process. For a consultation with an experienced family law attorney in San Diego County, contact JWB Family Law.