Drawing Up a Budget
Drawing up a budget can help you to manage your finances.
Drawing Up a Budget
It is recommended for you to read the following content with a clear mind. If you are feeling emotional at this point in time, you may wish to come back to this page later when you are in a calmer state of mind.
Divorce can be emotionally trying, which can be worsened by possible strains in your finances. You may have to adjust your current lifestyle and reconsider your spending habits. Hence, it is important to understand the possible impact a divorce may have on your personal finances early. If you have not drawn up a budget, you may consider doing so as it would give you a good overview of your financial situation.
Here are some tips for you to kickstart your budget planning. As a general guide, you can start with estimates first and fill in the exact amounts later when coming up with your budget.
When establishing a budget, it is important to keep your income in mind as this will directly affect how much expenditure you can have. Your income may include:
- Monthly nett salary;
- Investment returns;
- Property rental; and
- Insurance payouts.
You may also include the following in the event of a divorce:
- Spousal and/or child maintenance received from your spouse (if any)
Income and expenditure come hand in hand, and it is equally important to understand your expenditure. Your expenditure may include:
- Housing loan/rent;
- Food and groceries;
- Personal expenses;
- Expenses related to your children;
- Taxes; and
- Debts (e.g. loan repayments or credit card balances).
You are also likely to incur the following in the event of a divorce:
- Legal fees associated with divorce
- Spousal and/or child maintenance (depending on your circumstances, and if there are children to the marriage)
After listing down your source(s) of income and expenditure, it is important to balance your budget and understand the changes to your income and/or expenditure that may be required when considering a divorce. You may wish to:
- Manage your income.
- If you are currently unemployed and are looking for employment after the divorce, you can approach Workforce Singapore for career assistance.
- Set aside a portion of your income to be saved if you have not already been doing so.
- Ideally, you should save 10% of your income every month. For the rest of your income, use a budget to manage your expenses.
- Manage your expenditure.
- If your budget is in deficit, you may need to consider increasing your source(s) of income and/or reducing your expenditure. As you review your budget, do also consider if there are non-essentials that you can remove from your list. Adjustments to your lifestyles might be needed so that you can balance your budget.
As your source(s) of income and/or expenditure may change from time to time, keep track of your budget and update it regularly to help you to take control of your finances.
 Referenced from Moneysense’s article on Managing Your Money: https://www.moneysense.gov.sg/articles/2018/11/managing-your-money