After a period of being in a marriage or partnership, no matter the length of time, it’s perfectly natural for finances to become intertwined and you become used to being linked with your spouse or partner. This means that when working out finances, it becomes second nature to account for both incomes and assets. It can come as a harsh reality check when faced with the prospect of divorce or separation that you are going to need to be financially independent.
For some people, this is a huge shock because many leave it to their partners or spouses to deal with, not knowing the details or the account information. As such, a financial settlement is often a big aspect of discussion during a divorce or separation.
There are some crucial things to consider when undergoing a separation or divorce in terms of your financial stability in the future.
Make sure you declare all your assets to your solicitor and ensure that everything is covered on your ex partners side too. Both parties should provide documents to support their claims, and each should get independent valuations where necessary. Ensure this includes income, investments property, pensions, savings, insurance and more.
You also need to ensure that the housing needs of both parties are met. If a house sale is involved, it is important to consider who will live where. In an amicable situation, it may be agreed that one party can stay in the house during the sale. If one party is taking over a mortgage or tenancy, have you ensured your incomings and expenditure align and you’re not left short?
If a divorce or separation involves children, it’s also important to consider the long-term costs of care to the parent with parental responsibility. From school uniforms, to recreational activities, to long term when they go off to university, even the basic needs such as food and baby products need to be considered.
Debts also need to be considered as often during a marriage, both parties become liable for debts and it is important to establish the handover of these debts to the respective parties.
The most important thing to remember is always think about a long-term solution, don’t make decisions when emotions are running high or if you feel under pressure, it’s okay to take time to ensure the settlement meets your needs for the short and the long term.
If possible, try and remain amicable and keep the lines of communication open with both your ex and your solicitor; the situation becomes so much harder if communication is ceased.