When you find out that your partner is wanting divorce, it’s like a traffic accident, everything goes into a slow motion. You can see it all unveiling around you, but you just don’t know what to do, or who to talk to. Whether it comes as a sudden shock or more gradually, divorce and separation brings emotional confusion to peoples’ lives and challenging issues to their finances.
You firstly call your best friends for help and guidance. They give you some practical and emotional support, but most are not suited to help you.
After digesting the initial shock, in the next stage people go into self-preservation mode. It’s all about priorities here. My best advice is – see your financial adviser. Their objective point of view will help you sort out your priorities in the order of – your children, yourself and your ex-partner.
‘Although I’m a financial adviser myself, it wasn’t by accident that, I’ve had my own personal planner to ask for guidance and to assist me see things less emotionally ’.
The solutions are not always straight forward of course. One partner may gain a major asset like the family home but struggle to meet everyday costs because of the drop in household income. Conversely, separating finances may mean one partner taking on more debt to buy another house or car. Being the main determinant of building personal wealth and independence, the tremor of changes in your income may also affect the long term ability to meet life goals and aspirations.
Where there are children, considerations like meeting their future education needs, health care and other expenses, as well as the cost of holidays, excursions and visits to either parent or grandparents, all have to be discussed and agreed on.
It’s true that the challenges may be considerable but with these challenges comes the opportunity to plan for a different future, a new future.
Many people easily fall into the emotional trap of prolonged legal arguments and courts. The general rule here is – only go to a court if someone takes you. Initiating long and emotional court battles can cost you hundreds of thousands of dollars and years of your life you never get back.
This is the time to build your new life, not lose whatever you have left.
Wills and estate plans may also have to be re-thought and re-written, while a review of the ownership of life insurance policies is essential. Property settlement might sound as though it just involves the house, but it also covers everything from investments, superannuation and trusts, right through to cars and companies.
With the best intentions you may think, “Don’t we just take half each?”, but the complexities of both life and the law mean that it may not be that simple, and you normally require the expertise of financial and legal professionals, working together to reach a clear understanding of the way forward.
By sitting down and talking with your financial adviser you can tap into their experience. This will provide you with real support when the emotional challenges you face may be complex, and your life is taking a new direction.
After meeting Helen from Your Best Interests TV show and, during filming of her story, I felt very privileged to be able to help her move on, so she could start to build a new wonderful life. Prior to meeting me, she was stuck in purgatory, neither going forward or backwards. Now she’s looking forward to the rest of her life, and feels she is in control of her life again.
When I watched the first cut, I quietly sat with my wife. Then I cried. Not because my first TV performance was so bad. Rather because I felt proud to be a positive catalyst in the lives of this mother and her daughter.
Bill Bracey is a licensed financial adviser at Sydney Financial Planning ABN 60 898 090 975, an Authorised Representative of Charter Financial Planning Limited AFSL 234665.
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General Advice Disclaimer: Information in this article is of general nature only and is not intended as personal advice. It does not take into account your particular objectives or financial situation and needs.