Top financial tips for couples splitting up this Divorce Month
January is known to be Divorce Month, with legal experts being particularly busy in the new year following marriage breakdowns over the festive period.
Family court statistics show us that the first three months of the year always has a higher rate of divorce petitions than the rest of the year.
And with the new no-fault divorce laws coming into force last year, we are aware this could lead to rushed financial settlements and an unfair sharing of your overall wealth.
Getting legal support for yourself during a divorce is vital, but many are unaware of the importance of financial help during this period, especially with new rules they may be unfamiliar with. At a time when traditionally divorce is at its highest, it’s important that people understand the financial implications and receive the best help they can.
Sorting out a divorce is difficult enough, but receiving support from a financial advisor can help to ease the stress and financial burden.
We would encourage anyone facing divorce proceedings to look closely at their finances – this is especially important for those who don’t earn as much as their spouse. It will help you secure your financial future.
Take some time to consider what your divorce may mean to you. This may sound obvious, but divorce is a life event that can have both immediate and long-term financial impact. This can range from short-term worries such as cashflow, your children and your home, to future concerns, such as pension provision and how to navigate later life with a single income. Take a moment to think about what your means to you and potential outcomes you’d like.
You shouldn’t assume that you’re not entitled to your spouse’s assets. Very few people are aware of exactly what they’re entitled to. The divorce process often leads to assets being distributed according to the financial needs of those involved, so this differs for each case. You may be entitled to more than you first thought, so don’t rule this possibility out.
Since new laws surrounding divorce came into play in April 2022, a period of 20 weeks between starting proceedings and going through with your divorce application – meaning a divorce will take at least six months or more to complete. Use this time to really review your finances for the upcoming year and understand what you want – and need – from your divorce.
Whether you have children or just yourself to think about, really consider what you need from your divorce to secure your future finances. Plan for what you need rather than react to what you’re offered. Does the settlement include mortgage payments being covered, provisions being made for your pension, or being able to pay energy bills once you begin to rely on a single income?
Solicitors don’t have the detailed knowledge of the investment options open to you and the pros and cons of moving money from where it is already held, whether that’s in trust funds, pensions or ISAs. Our expert advisers can help you get the most financially out of your divorce, so get in touch to find out more about how we can help.
Quite often, the end of a relationship highlights a previously uneven split in control over finances. With women more likely to work part-time, become stay at home parents or care for elderly family members, day to day financial decision making, such as the household budget, mortgage payments and bills, has been in the sole control of the breadwinning spouse. Take time to consider what financial control you’d like to regain from your divorce, and make sure your legal adviser is supporting this too.
If it seems like the experts you’ve put your trust in don’t care or aren’t listening, then they probably don’t. You are dealing with enough already, so find new ones. Divorce can be stressful, unsettling and can trigger many emotions. But working with advisers like those at Path Financial who share your values – and understand your situation – can help relieve worries you have over your settlement and future finances.
If you need more advice about how best to navigate your divorce financially, get in touch. We can provide expert financial advice for those how need more support with this process.
As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.