How do I protect my financial health after separation or divorce?

Dividing assets after separation or divorce can be challenging. There are a number of financial matters that you will need to consider immediately after separation or divorce to protect you financially. Some of the financial matters that you will need to turn your mind to after separation include:-

1. Close any joint credit cards (if necessary).
2. Keep a copy of all documents relating to joint assets in a safe place to make it easier to gather disclosure when working out your property pool.
3. Terminate any Power of Attorney that you have to appoint your former spouse as Attorney.
4. Change your password to personal bank accounts, emails and other accounts that may contain sensitive information or financial details.
5. Consider whether you need to withdraw cash from a joint bank account. Remember that this needs to be done in a fair manner to maintain your independence whilst ensuring that your former spouse is not left without any funds or a shortfall.
6. Update your Will.
7. Contact your bank to ensure that joint accounts require two signatures, including any home loan accounts. It is best to ensure that two signatures are required for any redraw facilities and home loan accounts if you have a home loan. We recommend following up with the bank in writing to confirm your request so that you have a record of such a request.
8. Confirm with your bank that you will receive a copy of all letters to stay informed about bank accounts, credit cards and home loan records.
9. Review your superannuation beneficiaries and any binding death nomination.  
10. Review your insurance cover, including any life insurance.

Discussing your financial affairs with your former spouse may be challenging. However, it is important to keep communication lines open and have the right mindset to promote an amicable separation.

After separation or divorce, you are your former spouse will need to determine the value of your property pool. To do this, you will be required to exchange all financial information and provide documents. The act of exchanging disclosure is described by the Court as providing ‘full and frank disclosure’. Financial disclosure includes but is not limited to bank statements, credit card statements, tax returns, payslips, super statements and financial documents that relate to your financial settlement. It is important that you are knowledgeable about your financial circumstances and position. Exchanging disclosure early after separation can help you and your former spouse to agree on splitting your property pool and moving on more quickly.

After separation, it is a good idea to create autonomy by drawing up a new household budget for yourself as potentially a single-income earner and opening a new bank account in your name only. You may need to make some necessary financial adjustments to adjust to a single-income household.

Some separating couples choose to keep their finances in a joint account until certain debts are paid off, for example, if you decide to sell your former marital home.

The most crucial tip to maintaining financial health after separation or divorce is to, if possible,  remain amicable. The spark between you and your former spouse may have ended but that doesn’t mean you cannot part on good terms. Working together to resolve your financial split and having a Collaborative Family Lawyer draft your legal documents to formalise your agreement will save you thousands in legal fees compared to what you would have otherwise spent on heading to Court.

If you would like some more free tips on things you need to consider after separation or divorce, download our free separation checklist today at www.gfclaw.com.au.

To make an appointment with one of our experienced Collaborative Family Law Solicitors, please call 1300 414 855 or send us an enquiry through our online form today.