Posted on October 6, 2011
At a time in one’s life of significant emotional upheaval, it can be all too easy to ignore or put to one side matters relating to money. This can be especially the case if you’ve had little or no prior involvement with the household finances.
As difficult as it can be to focus on money matters at this time, doing so as early in the divorce process as possible will actually prove to be time very well spent for both parties, initially, allowing both to gain a good understanding of the current financial position.
Knowing and appreciating the current position is the beginning. What is equally important is to also consider and put together a plan for what your financial life may look like after the divorce is complete.
By doing this as early as possible, both you and your advisors will have an understanding of your current financial situation and what your financial goals.
Employing such a strategy can go a long way in setting the foundations for getting what you need and perhaps also limiting potential conflict. It also provides important input to any mediation that might be arranged later.
Now, this may seem like a rather daunting prospect for many, but there are plenty of helpful resources available, for example, The Money Advice Service is a free resource which is funded by fees from regulated financial services firms.
It’s divorce and separation calculator allows divorcing and separating couples to easily piece together a picture of their overall wealth and allow conversations about money matters to develop and different scenarios to be considered.
You can complete financial tables of assets, liabilities, income and budgets online, and you can do this together or separately.
Results can be emailed to your mediator, who can project them onto a screen or view them on a laptop during a mediation session and go through them with both of you, with the facility to make amendments online.
The calculator allows the mediator to demonstrate different sharing scenarios, with each one capable of being printed.
So, in summary, put a plan together, carry out a thorough audit of personal income and outgoings, and think of your financial future after divorce and what it will look like.
Employ and make use of easy to use free resources to help you and your advisors.
Also, be pragmatic and recognise that the standard of living to which you were previously accustomed might no longer be possible.