Surviving divorce financially

Coins and credit cardDivorce is messy, prolonged and, potentially, eye-wateringly expensive. But if it's right for you, it can also be the most liberating thing you've ever experienced - in time. And part of why it's so liberating, for many women at least, is that it gives them - sometimes for the first time in their lives - financial independence.

But that's down the line. For now, there are various things you have to do and think about. Ideally, you and your soon-to-be-ex can sit down together and draw up an amicable agreement about how you run your financial arrangements in the future, until your youngest child is out of full-time education and independent. 

Unfortunately, it doesn't always work that way. So, depending on what your relationship with your partner is like, you need to know about and address the following:

  • You don't want your ex-partner to empty or close your joint account. If there's an arranged overdraft facility, you may end up being liable for it even if you didn't spend the money. If you think there's a risk of this happening, contact your bank to ask their advice on what to do next. They may suggest that you change the basis of the account, so that from this point on they need permission from both of you to make major changes to your account. Or you can ask the bank to freeze the account - and it will then only be unfrozen when both you and your ex-partner together agree to what happens next.
  • If you don't have your own, separate bank account, you'll need to open one so that any payments and tax credits can be paid directly to you.
  • If you have a joint credit card, put a stop on it. Decide together how you're going to deal with the outstanding debt, and then transfer the relevant amounts to new, separate cards.
  • If you're married or in a civil partnership, you can apply to the courts to prevent your ex from selling property or joint assets once you've started divorce (or dissolution for civil partnerships) proceedings.
  • You are responsible for debts that are in your name, even joint debts.
  • If you haven't made a will, it's even more important to do it now than it was before. As well as ensuring that your assets are divided as you want them to be, you also need to think about who you'd appoint as guardian if you've got sole responsibility for your child. If you have made a will, you'll need to change your existing will or make a new one.

Who you need to inform about your divorce 

  • Your mortgage lender, landlord or housing office
  • Insurance companies (you have to tell them about any change in your circumstances, even if you don't have joint policies with your partner)
  • Council tax office 
  • Benefits office
  • Utility providers (gas, water etc, and internet service provider) 
  • Tax Credits office if you've been getting tax credits or may now claim them
  • Jobcentre Plus if you have been getting, or can now claim state benefits, such as income support
  • HM Revenue & Customs
  • Your bank if you have a joint account
  • Credit card companies
  • GP and child health clinics
  • Credit reference agencies to check your credit is no longer linked with your partner
     

And Mumsnetters say...

Got a question? Chat on our Talk forums
  • One way you can organise things is to do pension offset. My ex's pension pot is worth about £100k and as he's not far off retirement he's keeping that and I'm having a bigger share of the equity (we're having to sell the house). We have two teenagers and we're looking at a split of about 60/40. TheFutureMrsClooney
  • The courts are not interested in apportioning blame (especially in the case of something as commonplace as infidelity), and they ignore fault in the separation of the assets. Generally in England and Wales, the assumption is a 50/50 split of all assets, except where children are involved; in the latter case it will depend on who has primary residency. Beanlet
  • I have done the divorce part myself (forms available online). If you agree on the finance side, you can do a consent order. As it has to be done in the correct manner it is best to get it drawn up by a solicitor. You can do this via an online firm as well, and it's then presented to the court once you have a decree nisi. The judge will look at it and check that it is fair. Callow
  • The priority is keeping the children housed. If you are able to take over the mortgage, then he will be entitled to some (not necessarily half) of the equity. If you cannot raise that now, then he may have to wait until the youngest reaches 16 or finishes education. He may be entitled to some of your pension, but if he works and has his own that is unlikely. He should also be paying child maintenance. BellsaRinging

 

Information from the Money Advice Service on the key financial considerations in divorce or separation:

 

 

Disclaimer: Any content in our family money section is intended as general information only. For specific advice about your personal financial situation, get advice from qualified, independent, regulated professionals.

Last updated: 28-May-2014 at 12:58 PM