Empowerment in Divorce | Budget, Cash Flow, Values, and Outcomes
Cash flow planning offers a tangible way to reconnect with your core values and prioritize them.
S. Dahl
Photo by: Brooke Cagle
Values-based cash flow planning during divorce transforms financial management from a survival exercise into an empowerment tool by aligning spending decisions with authentic personal priorities rather than external pressures or past compromises.
This series is intended to dig into the powerfully positive impact ‘the money’ piece can have during divorce. The basics are straightforward, easy to understand once explained and prioritized properly, and can ultimately create comfort rather than anxiety.
Image by Getty
This series is divided into parts, all with the central theme of being intentional about leveraging the divorce process to gain control and accelerate into your next chapter.
Foundational Decision-Making Framework
Financial Organization for Control
Empowerment in Divorce: Financial Literacy Made Easy
Budget, Cash Flow, Values, and Outcomes
Roadmap for the Future
A recap on what the series has covered so far:
Foundational Decision-Making Framework – was the first installment in the series and focused in on creating a framework for decision-making. Getting a specific plan for progress in motion early in the process can have a profoundly positive impact on outcomes, both financial and emotional.
Breathe, Organize, and Accelerate out of Divorce – laid out a plan for getting the information and documents you need, putting together a team, and getting organized.
Empowerment in Divorce: Financial Literacy Made Easy – we drill down to the essential elements of financial literacy, the ones that will put you in the driver’s seat. The basics are straightforward and easy to understand once explained and prioritized properly.
In this paper, Budget, Cash Flow, Values, and Outcomes - we explore how aligning your spending with your actual priorities transforms budgeting from restriction into empowerment.
“ Financial decisions aligned with personal values create sustainable empowerment. ”
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Values-Based Cash Flow Planning
Here's something we see consistently: many women going through divorce realize they've been living according to someone else's financial priorities. Maybe it was your spouse's vision of the "right" neighborhood, or societal expectations about children's activities, or family pressure about certain purchases. Divorce, for all its difficulty, offers a reset. You get to ask: What do I actually care about? Not what should I care about, but what matters to me?
values based budgeting
Values-based budgeting involves identifying your fundamental priorities and then structuring your new financial plan accordingly. Think about your financial life as a mirror. When you look at your bank statements and credit card bills from the past year, do they reflect who you are and what you value? Or do they reflect compromise, obligation, and someone else's priorities? This approach transforms budgeting from a restrictive exercise into an empowering tool that reflects your authentic self. When spending decisions align with deeply held values, individuals report greater satisfaction with their financial choices and improved long-term outcomes, even when working with significantly reduced resources.
Actionable Steps:
Complete a values assessment exercise by listing your top 10 life priorities, then narrow them to your core 3-5 values that should drive financial decisions.
Create a "values budget" by allocating percentages of your income to categories that directly support your identified priorities before addressing other expenses. Instead of listing all your expenses and trying to find places to cut, you start by funding your values first.
Establish monthly "values check-ins" where you review spending from the previous month and assess whether it aligned with your stated priorities. When you fund your priorities first, you make peace with what gets less. You're not failing to afford everything—you're succeeding at funding what matters.
Develop decision-making criteria by creating specific questions to ask before major purchases (e.g., "Does this support my children's stability?" or "Will this advance my career goals?").
Practice values-based trade-offs by identifying areas where you can reduce spending that doesn't align with your priorities to fund areas that do
Cash Flow During the Chaos
Let's be honest: the divorce process creates financial chaos. You have legal bills you can't predict. You might have duplicate housing costs. Income might be disrupted. Traditional budgeting advice—"track your spending, cut the lattes"—fails spectacularly during this period because it assumes stability you don't have.
Here's what works better: map out the divorce timeline as best you can, even knowing it will change. Break out three timelines, best case (quick resolution, costs reasonable), worst case (things drag out, costs escalate), most likely case (something in between). Include items such as: When do you file? Estimate: $X in filing fees. When does mediation happen? Estimate: $X in mediation costs. When do you need temporary housing? Estimate: $X for deposits and moving. When do attorney bills come due? Estimate: $X monthly. Write it all down. Not because it will be perfectly accurate — it won't be — but because creating the maps gives you a sense of control when everything feels out of control. You're not pretending you can predict the future. You're preparing to handle multiple versions of it.
Having all three scenarios mapped means you're not blindsided. When costs spike, you don't panic—you shift to your worst-case plan. When things resolve faster than expected, you don't wastefully spend the "extra"—you rebuild your reserves.
The Transition Emergency Fund
You probably know about emergency funds — three to six months of core living expenses in savings. During divorce, you need something additional: a separate transition emergency fund which covers 3-6 months of expected divorce related cost, the ones you mapped out above. This fund covers divorce-specific costs: legal fees, moving expenses, duplicate housing, income gaps, etc. Why separate it? The transition fund is meant to be spent during this chaos. Your regular emergency fund is for your future stability.
Where does this money come from? Sometimes from marital savings. Sometimes from early asset distribution. Sometimes from strategic use of credit, paid down quickly once assets transfer. Sometimes from temporary lifestyle adjustments. A trusted advisor can help you think through the options specific to your situation.
Actionable Steps:
Create a divorce timeline with estimated costs for each phase (filing, mediation, attorney fees, moving expenses) and identify a realistic funding source for each expense. Lean on trusted advisors to help.
Build a transition emergency fund separate from your regular emergency savings, targeting 3-6 months of estimated divorce related expenses.
Develop three cash flow scenarios: best case (quick resolution, minimal disruption), worst case (extended proceedings, significant income loss), and most likely case, with specific action plans for each
Establish a weekly cash flow monitoring system during active divorce proceedings, tracking actual expenses against projections and adjusting spending in real-time
Create a "cash flow triage" system that prioritizes expenses into categories: critical (housing, utilities, food), important (legal fees, childcare), and deferrable (entertainment, non-essential purchases)
Negotiate payment plans with service providers (attorneys, therapists, moving companies) to spread costs over time and improve cash flow management
Image by Tachina Lee
Empowerment Through Financial Autonomy and Long-Term Planning
Developing independent financial management skills during divorce creates a foundation for long-term empowerment that extends far beyond monetary outcomes. Many clients, particularly those who weren't primary financial decision-makers during marriage, discover capabilities and confidence they didn't know they possessed. This newfound financial literacy and control become a source of personal strength that positively influences career decisions, relationship choices, and overall life satisfaction in the years following divorce.
Financial Autonomy
Building financial autonomy involves developing systems for tracking expenses (there are many good, simple digital options), making investment decisions, planning for retirement, and setting financial goals that reflect your individual aspirations rather than compromise positions. The process of creating and executing a values-aligned financial plan provides concrete evidence of personal capability and control during a time when many other life areas feel uncertain. Research shows that individuals who emerge from divorce with strong financial management skills and clear long-term plans report higher levels of life satisfaction and confidence in their ability to handle future challenges.
Actionable Steps:
Implement a personal financial management system using budgeting software or apps or just a simple notepad. For three months, just track expenses to understand your spending patterns and identify optimization opportunities. This tracking phase builds the foundation for everything else. You can't optimize what you don't understand.
Create a post-divorce financial education plan by identifying knowledge gaps (investing, tax planning, insurance) and committing to specific learning resources like books, courses, workshops. or education sessions with your advisor.
Set measurable financial milestones for 6 months, 1 year, and 5 years post-divorce, including specific targets for emergency savings, debt reduction, retirement contributions, and major life goals.
Build a financial support network by identifying professionals (financial advisor, tax preparer, estate planning attorney) and trusted friends or family members who can provide guidance and accountability.
Practice financial decision-making independence by starting with smaller choices (choosing insurance plans, comparing service providers) before moving to larger decisions (investment allocations, home purchases).
Document your financial progress through regular reviews and celebrations of milestones achieved, creating tangible evidence of your growing financial competence and independence.
When spending aligns with values, something shifts. Budgeting stops feeling like deprivation and starts feeling like design. You're not cutting back—you're building something that reflects who you actually are. The financial management skills you develop during this transition create a foundation that extends far beyond monetary outcomes. You're building competence, confidence, and control that will serve you for decades.
Simplicity, purpose, control
Part five of five in our series Empowerment in Divorce - Coming Soon
Empowerment in Divorce | Roadmap for the Future
ABOUT THE AUTHOR
Susan Dahl is a well-regarded executive, female industry leader, and dedicated client advisor with over twenty-five years of experience. Susan writes on topics such as investing, strategy, and divorce. She is the author of the blog series Female Advisor Perspective, a look into the unique strategy, process, and planning insights that emerge when problem solving is viewed through the unique lens of experienced female financial advisors. Susan’s deep and diverse background extends from global investing to risk management to change leadership. This background has laid the groundwork for an approach that asks more of wealth. She shares some of her most recent work in a talk for TEDx, Can Happy Make You Money?
