Separating from your partner can be a very stressful and difficult time for everyone involved, as there are so many things that have to be taken into consideration. Although the divorce rate in parts of the UK has been falling over recent years, there are still many couples who decide they want to separate with a view to getting a divorce. For these couples, it is important to think about a number of key considerations, one of which is finances.
There are many financial considerations that have to be taken into account for couples who are separating. This includes considerations relating to how their financial situations will change following separation, as well as financial considerations such as the division of savings and assets. Finances can play a big part in the separation process, in a range of different ways.
5 key financial considerations to take into account if you are considering separation
There are a number of key financial considerations that you need to think about if you are looking at separating from your partner. This includes:
Managing on a single income: If you have been living with your partner for quite some time and both of you are working, you have probably become accustomed to a certain level of income each month. Once you separate, you will be left with a reduced income and you need to take time to work out how you can adapt your lifestyle and make changes to accommodate what could be a steep drop in income levels.
Savings and assets: Many couples decide to set up joint savings accounts and invest in shared assets such as a car or a home. You need to work out how this will be divided and dealt with so that both parties get what they are entitled to. When it comes to savings, you may decide to simply split the money 50/50, if you have both been depositing into the account. However, when it comes to assets, such as your home, you may need to look at options such as one partner buying the other out.
The cost of divorce: If your relationship is definitely at an end and you are separating with a view to divorce, you also need to take the divorce fee into consideration. The cost of divorce can vary based on your situation and whether or not you use a solicitor. Bear in mind that in some cases you may have to wait a minimum amount of time before you can get divorced, which will give you time to put money aside towards your divorce costs.
Insurance and will: If you are separating from your partner, you need to make sure you look at any insurance policies that you hold, as well as your will if you have one. After separation, you may want to change the details of your main beneficiary, as you may have put your partner’s name down.
Maintenance: If you have children, you may have to deal with financial maintenance issues based on who the kids will be residing with. This is something that you can agree upon between yourselves if you are able to reach a mutually agreeable decision. If not, it is well worth contacting the Child Maintenance Option Service, which is a free service that can support parents who need advice about the best way to sort out maintenance issues.
These are 5 of the key financial considerations that you will need to think about if you decide to separate.