I don’t have a standard “newly separated person buying a car” response because it depends significantly on a person’s entire life and financial situation, which is unique from everyone else’s life situation. Making easier decisions comes down to knowing yourself. 

How do you get to know yourself?

Here is a link to a values worksheet – one small step you can take to start getting to know yourself. 

Once you know what motivates and drives (pardon the pun) you, it helps you to make a decision. A hedonist will look for a different car than someone who likes conformity. Or someone who likes stimulation? Yes– they would likely not want my 2003 Toyota Corolla or, as I used to call it, “my divorcemobile.” I recently renamed my vehicle – “my trusty steed” – a car that gets good gas mileage and hasn’t cost me much to repair. You see when I first named my car, I was viewing it through the eyes of what I thought others would see, and what others think is none of my business. My business is knowing myself and living my life aligning with my values. Keeping my cash outflows less than my inflows is part of my standard operating system, and my trusty steed is one important spoke of keeping a balanced life. 

Understanding your current financial situation is the other important step necessary when making decisions. You need to know how much money you have to spend and how much you will earn and spend in the future. I have noticed that many people get stuck at this point – it’s usually when I mention the word “budget” that eyes glaze over, or the other common expression I see is “deer caught in headlights.” 

Budgets, aka spending plans or cash flow statements, are very easy to prepare from a logistical perspective.  Money coming in goes at the top, and money going out goes underneath – they look something like this: 

After-tax Salary:  $5,000

Housing: $3.500

Food: $600

Gas: $200

Clothes: $100

Fun: $1,000

Net Monthly Cash Surplus (Deficit): ($400)

The challenge in preparing budgets is that pesky human tendency to let fear rule one’s life, which carries into the budgeting process. I have noticed that most of us (me included!) only prepare budgets when we have to – often in the middle of a life transition. We also “think” we will discover that our financial situation will inhibit us from living the lives we want. “No budget is going to tell me how I live my life!” I have heard people say. Hence, they avoid doing the budget – because they will not follow it anyway.

The other reason people don’t like budgets is because they worry that the budget will confirm what they believe to be true – there is not enough money to live the life they want. Avoidance is one way to live- but talk to any counsellor, coach or mental health professional, and they will tell you that eventually, avoidance will catch up with you, and it usually leads to being more stuck than before.

I was forced to do a budget when I separated (shocking, perhaps –  I hadn’t needed to budget before my divorce because I have always kept my cash outflows less than my inflows and always had a surplus that I directed to savings – divorce wiped out that situation!). I prepared my budget, and it did confirm that I was in a deficit position. I did not have much in the way of cash inflows – child support and a small amount of savings. Newly divorced and on the job hunt, I would look at my budget and cry – how would I ever get out of a deficit position?

My budget helped me get unstuck. I slashed my spending, and I dipped a little more into my RRSP and got coaching help. My budget and understanding of my values, needs and hopes allowed me to grow into a situation where my cash inflows are again more than my outflows.  However, I think it’s time to budget again – my kids are entering their post-secondary education years – yes, the fear of the future is beginning to bubble up in me!

When I divorced, I bought an 11-year-old Toyota Corolla for $6,000. It had low miles and low street appeal. Post-divorce, I didn’t believe I would ever have any money to pay for a more expensive car. And I was right – I have spent my new earnings on things I deemed more important than a newer and fancier car. 

When you’re in the midst of a stressful life transition, you will make some very significant life decisions – do not base those decisions on what other people tell you. Base them on what works for you. You will likely want to make a quick decision to get out of the pain of being stuck in life transition limbo but don’t succumb to short-term pain by making quick, unthought-out decisions. Instead, take the time to get to know yourself and understand the decisions that will work for you.

Here is a link to a decision-helping spreadsheet.  To make a copy that can be edited, navigate to and click “make a copy” under “File” in the top menu bar. You can use this spreadsheet once you have done the values exercise and prepared a budget. 

Once you know yourself more, every decision you make will become easier.