Don't Let Your Payments Ruin Your Finances
Monthly child support payments averaged $430 in 2010, according to the U.S. Census Bureau. While it’s important to take care of your child, you also have to make sure that supporting those you love doesn’t ruin your financial future. Here’s how to meet your obligations and keep your finances on track:
Be knowledgeable. Look at your divorce or separation agreement, making sure you know exactly what you’re responsible for paying and when it’s due. Consider other child-related expenses that will need to be split, such as childcare, insurance, medical bills, and the child’s extracurricular activities. If you’re having trouble keeping track of expenses, SupportPay.com lets parents upload receipts, maintain proof of payments, and even keeps track of disputed bills for future court dates—all for free.
Budget for it. Once you know what you’ll need to contribute each month, you can set up a budget system and have the money automatically put into a separate account or transferred to your ex-spouse’s account in whatever time frame you agreed upon. Putting some cash aside each week will make it easier to pay when the times comes.
Deal with debt. Most debt accrued during a marriage gets split in the case of a divorce. You’ll be responsible for an agreed-upon portion, but you’ll want to close any joint accounts and pay them off as agreed so further joint debt can’t be accrued. If your spouse is keeping the house, make sure to have your name removed from the mortgage and deed once he or she refinances it.
Don’t neglect your retirement. If money is tight, it may be tempting to reduce your retirement contribution. Try to avoid this whenever possible—even if you have to cut back on some luxuries or earn some extra cash. A $50 monthly reduction in what you contribute for retirement over 20 years could cost you more than $25,000 in your retirement account total.
*Independent Bank is not specifically recommending SupportPay.com, and the user is responsible for researching the privacy/security policies before utilizing this or other similar services.
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