How do you budget after a divorce?

List every source of income you will have after the separation, as monthly figures after tax:

• your pay or self-employed profit
• child maintenance
• spousal maintenance, if any
• benefits, including Child Benefit and Universal Credit
• income from savings, investments or rent

Be cautious with spousal maintenance. Under section 28 of the Matrimonial Causes Act 1973, a maintenance order made on divorce ends if you remarry or form a civil partnership, and it ends on either person's death. Many orders also end on a fixed date.

Tax credits ended on 5 April 2025, so if you used to receive them, Universal Credit is now the main means-tested benefit for people of working age. A free benefits calculator linked from GOV.UK shows what you might get on your new income.

You can agree child maintenance between you, or use the Child Maintenance Service. GOV.UK has a child maintenance calculator that estimates the amount without sharing your details.

If the service is involved, there are two ways to pay. With Direct Pay the paying parent pays you directly and there are no collection fees. With Collect and Pay the service collects the money: the paying parent pays a 20% fee on top and the receiving parent has 4% taken off.

Only one person can claim Child Benefit for a child. If the children live mainly with you, make sure the claim is in your name. It also gives you National Insurance credits towards your State Pension while a child is under 12, so it is worth claiming even if you choose not to receive the payments.

• Council tax. If you are the only adult in the home, you get 25% off your bill, but you have to apply for it.
• Marriage Allowance. If either of you transferred part of your Personal Allowance, it must be cancelled on divorce or legal separation, and the change can be backdated to the start of the tax year.
• Insurance and contracts. Home, car and life insurance, broadband, energy and phone contracts may be in joint names or your ex's name. Move the ones you need into your own name and shop around while you do it.
• Subscriptions. Shared streaming, memberships and family plans are easy to miss.

1. Write down your expected monthly income from the list above.
2. Track what you actually spend for a month, from bank and card statements.
3. Split spending into essentials (housing, council tax, energy, food, transport, childcare, insurance and debt repayments) and everything else.
4. Look for savings in the non-essentials first, then in contracts you can switch.
5. Set aside a small amount each month for emergencies, even if it starts small.

Our budget planner can help you lay it out, and the emergency fund calculator shows how long your savings would last.

A settlement offer is only good if you can live on it. Before agreeing, run each option through your budget. Keeping the house might mean a mortgage you can't afford on one income. Taking more cash now might mean less pension later. Maintenance that ends in a few years needs a plan for what replaces it.

Your budget is also useful evidence. If you go to court, Form E asks you to set out your future needs, and a realistic budget makes that easier to support.

Short-term pressures can crowd out pensions, but the years after a divorce matter for retirement. If you have a workplace pension, staying in it keeps your employer's contributions coming. Check your State Pension forecast for gaps.

If your settlement includes a pension share, it becomes a pension in your own name, and decisions about where it is held and how it is invested will shape your income in retirement. If you receive a lump sum, decide how much you need to keep as accessible savings before committing the rest anywhere.

If spousal maintenance has a fixed end date, use the years before it stops to raise your own income or build savings, so the drop doesn't arrive all at once. Child maintenance and Child Benefit also change as children grow up, so note the dates in your budget.

Review the budget after a few months and again whenever something changes, such as maintenance ending or a child leaving school.