Almost 56 per cent of divorce applications in 2016 were from a single applicant, according to ABS data, with more than half of Australia’s divorces coming as a relative surprise to one party.
As finances can be moved fairy quickly in this age of online banking, time is of the essence when protecting yourself during divorce.
Here are 10 tips to help get you through this emotionally traumatic event with the minimum amount of financial strain.
Secure your cash
If you lost access to all funds in any joint accounts, how much money would you have? Even if you are working and have a regular income, separation can be very costly in the short-term – especially if you are moving out – bond on a rental property, installation of electricity, phone and internet.
If you don’t already have one, create a separate bank account and redirect your pay and any other income into it.
You also need to secure credit cards or cancel if necessary along with password access to any important information.
Protect your identity
Cash isn’t the only thing you will need to start a new life. Identification documents will alsobe required in some cases.
You’ll likely have your licence, Medicare, insurance and credit cards in your wallet or purse, but if your passport, birth certificate and other important documents are in the house, don’t assume you will be able to pop in at a later date to collect them as needed.
Even the most amicable separation can turn nasty in a big hurry, so it is best to be prepared for that eventuality beforehand.
Contact a lawyer
If you haven’t done so already, now would be a good time to contact a lawyer.
While opening a bank account and collecting your ID are both reasonably straightforward, the next few steps in this process may involve contractual agreements that can have long-term effects, either positive or negative, depending on how they are handled.
Also, if you have a family lawyer already, one of you will need to look for new representation.
Organise your fixed costs
If you are the co-owner of a property, you will more than likely be the co-owner of a largemortgage and while we will get to the property settlement shortly, you need to ensure thatthe property is secured beforehand.
You may find an angry partner is unwilling to contribute to repayments, thereby jeopardising ownership with a bank default on the loan.
You may also have financial commitments to utilities such as water and electricity thatcould impact your credit status if left unpaid. It is preferable that any of these contracts arereviewed by your lawyer to consider how best to proceed.
Review your rental arrangements
Even if you live in a rental property, you will almost certainly be committed to a minimumterm on the rental agreement and simply walking away is not an option without potentiallyaffecting your credit rating and ability to rent again – which may be a necessity in the nearfuture.
Calculate your income and expenses
Your reality has just changed dramatically. While you may be entitled to significantcompensation in a settlement, those funds and assets will not be immediately available soyou need to create a budget detailing your income and likely expenditure for the nearfuture.
This process may also involve looking for new job that better suits your needs.
Consider arrangements for your children
In addition to custody and child support payments, you also need to contact their school orday-care to update your details and inform them that you have separated.
They will need to be made aware of any court orders restricting access to the children and it is also worth discussing payment arrangements to find a suitable solution for your new financial situation.
Update your will
Divorce doesn’t void an existing will, so if you have one it will need to be updated.
You also need to look at life insurance and superannuation to ensure the beneficiaries reflect your new wishes.
Sort out a settlement
Once you have ensured your immediate financial security, it is time to sit down with a lawyer, financial planner and accountant to consider a settlement agreement that will provide the long-term security that you hope to achieve.
Finally, and most importantly, if you feel that your or your children’s personal safety is atrisk, reach out to your local support groups or call 1800 RESPECT (1800 737 737)to talk to a domestic abuse specialist.
Olivia Maragna is the co-founder of Aspire Retire Financial Services and is a respected andindependent financial expert. Olivia’s advice is general in nature and readers should seek theirown professional advice before making any financial decisions.
You can follow Olivia on Facebook or Twitter at https://twitter.com/oliviamaragna