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Planning finances after a divorce

Maryland residents who are contemplating a divorce will at some point have to reevaluate their finances as newly single people. The absence of a spouse will have a significant effect on most people's finances whether or not they were working during their marriage. That's why one of the first things that a newly divorced person should do is to review their income and expenses and create a new budget.

Many divorce settlements include alimony, and person who has been ordered to pay alimony will have to budget for this new expense. An alimony recipient should also be aware that alimony is considered taxable income. After a divorce, a spouse who was not working during the marriage may need to come up with a plan to reenter the workforce. Non-working spouses who were listed on their ex's health insurance policy will also have to shop around for new health coverage.

One of the most important financial decisions a person has to make at the end of a marriage is where to live. As a single person, it might make sense to move into a smaller home that is less expensive. If a spouse was awarded the family home in a divorce settlement, they will have to decide whether or not they can afford to continue living there.

The divorce decree will have a great effect on each party's future finances, whether it incorporates a settlement agreement or is the result of litigation. A person who is concerned about how a divorce may impact their finances might want to have an attorney provide representation during negotiations and court appearances.

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