In the previous post in Carolyn’s story, Carolyn shared how she was funding her college education. I knew from our first interview that when she left her marriage Carolyn had never had her own bank account or credit card, nor had she ever paid a bill. So how was managing money now? Here’s Carolyn:
It’s going okay. I still tend to avoid dealing with it as much as possible. It’s so stressful to me, looking at money. I know that if I have money in my bank account, I feel like,
“Oh, there’s money in my bank account”
and I’ll make a purchase here and I’ll make a purchase here, and it disappears. It always disappears!
I did take out a small loan from my bank, like $2,000, just to establish credit, because at some point in the future, I’m going to want to buy a house and I don’t have any credit because I’ve never had any credit cards. I’ve been paying $40 on it every month and I’m actually close to paying it off now. It was my bank manager’s suggestion.
About a month into each semester, I get a check from the school and it’s all the student loans left after my tuition. I calculate how many months it’s going to be until I get another check like that and before I do anything, I pay my rent months ahead of time and I pay my utilities ahead of time. That way I don’t end up not having money or rather, I do run out of money, inevitably, but all I need is money to get me by and I’ve taken care of all the basics.
I just write my landlord a check for thousands of dollars. He loves me. I give him large chunks of cash ahead of time. Right now, with my phone company for example, I have a credit with them of around $200 and I have a credit with my gas company and my electric company.
I realized quickly that when I didn’t do it that way, I would end up freaking out because I wouldn’t have money to pay my utilities or God forbid, my rent, and that was scary.
Of course, I was helped when I first moved out. My mom helped me moved out and get the stuff that I needed, so I have a car, but I don’t have a car payment. She just bought me that car. Certainly not every single mom is in that kind of position and I’m very lucky I was able to get that help at the outset. Now I’m able mostly to be self-sufficient on my student loans and the scholarships I get.
At least when I borrow money from my mom now, I don’t have to ask her for my rent. Usually, it’s because I’m not getting my student loan disbursement for a month and I need to buy groceries. I think on balance, I’m probably still paying her back less than I take from her, so again I’m lucky that she’s able to do that. I’m fortunate, but as she reminds me, one day she’s going to be relying on me and she knows that it’ll be a lot easier on me when I’m in a good position to be able to help her out.
I don’t get child support. What we’ve worked out is that my ex pays for the children’s day care and he will pay for their tuition. Our eldest started at this private school in the fall, and they’re offering her a scholarship. They haven’t told us quite yet what it is, but he’s determined to pay it because he wants the kids to go to this good school. I’m glad that he feels that way. We don’t have it in writing, so hopefully we can either get it in writing or it’ll never matter.
I think for him, paying for their school protects his ego a little bit. I think he likes to feel that he’s single-handedly financing their education and that feels a lot better to him than writing a check to me every month. I think sometimes people have worries that their ex spouse is spending the money on herself so this takes that out of the equation. He knows that he just pays for the school and it solves me the problem of stressing out regularly about child care expenses.
The Divorce Coach Says
In the good ol’ days, when there was such a thing as interest on your savings account, I would have advised Carolyn against paying her bills in advance. I would have recommended still calculating out what she needed for the basics and then setting that aside in a separate bank account preferably with automatic payments set up to pay her landlord, utilities, phone etc. These days when the interest you earn is literally cents, Carolyn’s strategy seems like a good one for staying on budget.
My biggest concern today with paying in advance like this would be if the supplier went bankrupt or disappeared. Chances are you’d have to find and pay an alternate supplier and you’d be unlikely to see any of the money you’d paid in advance. I think with your phone company and utilities there’s little risk of that. With your landlord, I’d do some digging – wouldn’t want the bailiffs turning up to evict you.
Building your credit is important and a good first step is getting a copy of your credit report to see what it says now. You’ll be able to spot any errors and ask for corrections. You’ll also be able to see if there are still any accounts listed jointly with your ex. In fact, I’m a big believer in getting a copy of your credit report each year – it’s a great monitoring tool.
Saving the best to last, I love the arrangement Carolyn and her ex have come to with respect to financially supporting the children. The legal child support system is far from perfect and I am convinced that if you and your ex can work out your own financial agreement, without on-going legal involvement, it is by far the best outcome.
- Financially, it’s presumably an equitable solution because otherwise you wouldn’t have settled;
- You’re not spending those dollars on lawyer fees, particularly important if your budget is limited;
- I imagine the probability of adherence is very high;
- Being free from child-support battles is emotionally liberating; and
- Without the conflict, you are more likely to actively communicate with each other about what really matters – your children.
Photo credit: Jessa-Minnie