Creating Financial Independence during a Life Transition

Strategies for Women Rebuilding Their Lives During Major Life Events

I felt a bit of a fraud when I started writing this article. Who am I to give others financial advice? I was going through a major life upheaval though, and I needed to get my finances sorted, or at least in better order. So I did a lot of research and I’m sharing what I found useful with you in this article, hoping it will be useful to you too.

Imagine waking up one day to find that your financial stability has been destroyed overnight. Whether due to a divorce, the sudden loss of a partner, or an unexpected job loss, the journey to reclaim your financial independence can be both challenging and empowering. This is the story of Susan, who faced such a transition and emerged stronger, using practical strategies to gradually create a stable financial future for herself.

Susan, a 52-year-old marketing executive, had dedicated her life to her career and her family. After 25 years of marriage, her world was turned upside down when she and her husband decided to get divorced. Suddenly, Susan found herself single and solely responsible for her financial future. She felt completely overwhelmed by mortgage payments, college tuition for her two children, and looming everyday expenses.

Instead of succumbing to fear, Susan chose to take control. She sought advice from a financial planner, who helped her develop a clear plan. Susan began by reassessing her budget, cutting unnecessary expenses, and prioritising her financial goals. She took a course on financial literacy, empowering herself with the knowledge to make informed decisions. Within a year, Susan had not only stabilised her finances but also started saving for her retirement.

Susan’s story demonstrates that with determination and a few well-chosen strategies, rebuilding financial independence is achievable at any stage of life.

When I first read Susan’s story, I laughed, it sounded as unrealistic as a fairy tale! Susan and I clearly had NOTHING in common. Each time I decided to organise my finances, I came down with a debilitating attack of procrastinitis.

What got me out of the seemingly inescapable swamp, was setting an hour aside each day to try to get my financial ducks in a row, and gradually the situation went from drastic and desperate to…slightly better.

My 7 steps to a more prosperous financial future:

1. Assessing My Financial Situation:

Had to start here, however depressing it was. I needed a clear picture of my current financial status, so I listed all my assets (very short list), liabilities (long, scary list), income (even shorter list), and expenses (endless list). This helped me identify the areas that needed immediate attention.

2. Creating a Realistic Budget:

I had to force myself to do this, because, apparently, «A budget is a powerful tool for managing your finances.» So I tracked my spending and prioritised essential expenses like housing, utilities, groceries etc, and identified areas where I could cut back. The app YNAB (You Need a Budget) simplified this process and made it (slightly) more bearable.

3. Exploring Income Opportunities:

One thing I realised is that identifying a variety of income streams is essential. You know the saying, «Don’t put all your eggs in the same basket.» In the current financial climate, I think this should be an ongoing exercise, for all of us. It could involve consulting through platforms like Upwork and Fiverr, starting a small business selling products online via Etsy and Shopify, or doing part-time work offering local services. Teaching online courses, writing e-books, and creating digital content can also generate revenue, as can renting out property, equipment, or vehicles. Investing in education and acquiring high-demand skills can enhance one’s earning potential, while passive income from dividends, royalties, and affiliate marketing offers long-term financial benefits.

4. Investing in My Financial Education:

I agree that knowledge is power, especially when it comes to managing money, so I invested time in courses on personal finance, I joined suitable Facebook groups, subcribed to e-mail lists, and followed reputable financial blogs. I discovered that investment options, retirement planning, and debt management can significantly impact one’s financial future.

5. Building an Emergency Fund:

Got to be kidding, I thought. I’m fully aware now that life is unpredictable, and I realise that having an emergency fund can provide a financial safety net. Starting small, my aim is to save three to six months’ worth of living expenses. Eventually.

6. Seeking Professional Advice:

As soon as you can afford it, I recommend doing this. A financial advisor can provide personalised guidance tailored to one’s situation, help develop a long-term financial plan, manage investments, and advise on retirement funding options.

7. Cultivating an Empowering Mindset:

I am convinced that by fostering an informed and proactive mindset, you can empower yourself to make sound financial decisions and achieve long-term financial stability and independence. During my Manifest Your Next Chapter retreats, I discuss mindset in depth, as I feel that without the right mindset, any attempt to improve your financial situation is doomed before you even start.

Defining, or redefining, your Life Purpose during a life transition is also a game changer. Knowing your purpose at this time of your life keeps you motivated to improve your financial situation, as it is supported by your values and principles.

“Your economic security does not lie in your job; it lies in your own power to produce – to think, to learn, to create, to adapt. That’s true financial independence. It’s not having wealth; it’s having the power to produce wealth.” – Stephen Covey

It is never too late to take control of your financial future and plant the seeds for a prosperous, purposeful and independent life.