HomeFinanceHow to get your finances back on track following divorce

How to get your finances back on track following divorce

A relationship break-up or divorce can knock many areas of your life – including your finances. But while it takes time to mend a broken heart, there may be some practical steps you can put in place that will at least help support you on the money front.

“One of the most common concerns to an individual going through a divorce is how they will manage financially following the separation,” says Ben Evans, a family law solicitor at Co-op Legal Services.

Models of a divorced couple
Nearly two-thirds of people who delayed their divorce due to monetary reasons wish they hadn’t, according to Co-op Legal Sevices. (Alamy/PA)

For those considering a divorce, Mr Evans adds: “Before you progress any further, it’s important that you are certain this is the right move for you, and that there is no possibility of a resolution between you and your spouse.

“Marriage counselling is often a popular recommendation, and some couples even attempt to have a holiday together to see if there is a chance of reconnecting. However, if you believe you have tried every avenue, or you are certain the relationship is broken beyond repair, then you may want to start divorce proceedings.”

If you have decided that it’s truly the end of the relationship, Mr Evans highlights some key steps to consider to help alleviate financial issues.

Get advice

“Firstly, it’s important to gather all the information you can about your household and personal finances, in order to seek the best advice on your options and to plan for your future.

“If there are any financial accounts in your name or your joint name, the organisation which holds this information on you is obligated to share these details. For example, speak to the mortgage provider and find out all the necessary information about your mortgage agreement. You should also make a list of all the utility bills that are in your name.

“It is also beneficial to speak to the bank and ensure there is no untoward activity happening on your account and consider whether there is a need for practical arrangements to be put in place to avoid unwanted withdrawals. It is best to contact each institution involved as they may be able to offer you personalised support.”

A 30-something black man doing life admin at the kitchen table
It’s important to consider all aspects of your shared finances. (Alamy/PA)

One person in the relationship may have been more ‘hands on’ with the household’s finances than the other when you were together as a couple, so it’s important to make sure you’re up to speed.

If you have a joint account with your ex, and communication has broken down between you both, you could ask the bank to place a freeze on the account. You could also ask credit reference agencies to remove links with an ex from your credit report, if you no longer share a financial association.

“Lastly, as simple as it sounds, writing down a budget to map out how you will manage your income is greatly beneficial, and will help determine what support you need,” Mr Evans says.

Budgeting tools

Websites such as the government-backed Moneysmart have various budgeting tools that could help. It is also important not to overlook superannuation in the event of a divorce. Perhaps one person in the couple had been earning significantly more – and squirrelling more money into a superannuation – while the other has reduced their working hours to take on caring responsibilities.

Don’t forget to make any other updates that may be needed, such as changing a will, for example, or updating the names of your super beneficiaries with your provider. It could also be a good idea to reset any of your personal passwords that your ex is aware of.

Also, remember that support is out there.

“It’s no secret that divorce can be difficult to navigate, especially if the separation means changing your living location, but it’s important to seek support from trusted friends and family members or from external support groups,” says Mr Evans.

“If you are considering divorce, it’s also important to seek professional legal support from a specialist, who will be able to provide information and guidance on the next steps.”

Are you divorced? Did you find the financial separation hard? Why not share your experience in the comments section below?

Also read: How is superannuation divided during a divorce

– With Vicky Shaw

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