When going through divorce, you may find you’re unable to make clear-headed decisions, so use a checklist of the items below to help keep yourself and your finances safe.
- Identify what is yours
Divorce is emotional but in the eyes of the law, it’s about facts and figures. Collate as much paperwork as you can possible acquire, including financial statements, tax forms, bank accounts, tax returns, car registration papers and anything else related to your finances so it’s clear to see who owns, and owes what.
Always obtain hard copies of your financial records in the event your ex-spouse locks your out of your online accounts.
- Take a long term look at your finances to calculate what you need
Lump settlement sums can seem huge at first, but after ten years of taking care of children and mortgage costs, that sum can disappear very quickly. Look at your budget, both outgoings and incomings, for a week, a month, a year, five years, ten years, twenty, thirty and forty years. This will give you a clear picture of what settlement you will need, along with any government entitlements you may be eligible for.
- Understand every aspect included in a divorce settlement
Items covered in a divorce settlement include health and life insurance, child support and visitation, real estate, care, household items, bank accounts, debts, investments, super, retirement plans, pensions and more.
Since 2002, super is now a splittable asset in Australia, so both you and your partner’s super will be taken into consideration, as well as non-financial contributions such as time spent as a primary caregiver to children.
- Always hire a legal representative to ensure you don’t get short-changed
You’re in the midst of a relationship breakdown, and while you may understand the basics of divorce, you need a lawyer to protect you and help you get a fair deal.
Too many people think a lawyer will be too expensive, but in the long term, you will have a more financially successful divorce if you hire a lawyer to negotiate for you. If you can settle your divorce with legal representation only, you will also save money on fees. If not, you will need to go to mediation, and if you still can’t reach an agreement, you will need to pay huge fees in court.
Enlisting a good lawyer from the start is the best way to avoid costly and lengthy divorce proceedings, plus get the best settlement.
- Keep a diary of events
Being legally separated for 12 months is mandatory to obtain divorce in Australia, so always record the date you officially separated. If things get nasty such as incidences of vandalism, trespassing or calls to police; document the date and time of the event.
- Close joint accounts, leases and credit cards
Always notify your mortgage or debt lender that you have separated from your partner. Close joint bank accounts and set up an account in only your name where your pay and any government allowances will go, and close joint credit cards.
Change the pins to all your accounts in case your ex-partner decides to move your finances around without your knowledge.
If you’re staying in your rented home, update the lease so only your name is on it.
If you’re leaving a rented home, take your name off the lease as soon as you move out. Call all your utility providers and update the names on the bills. If you don’t update the name on utility bills, you will be responsible with paying what is owed.
- If your partner’s name is on the title of your family home, enquire about a caveat
If you and your children are living in the family home, but the title of the property is in your ex-partner’s name, ask your lawyer about obtaining a caveat on the property.
A caveat is a legal warning or notice put on the title to someone’s land telling anyone interested in buying or lending on that property that you are claiming a share of it. It stops your ex-partner from selling the property without you getting paid out your share.
- Protect the kids: Create a parenting plan with a family lawyer or institution
Children are often the unwilling victims of divorce, so keeping their lives stable is paramount. Creating a parenting plan with your ex-partner through your family lawyer is not legally binding, but it’s a great step to help keep your children safe and happy during this difficult time.
If things turn really nasty:
- Withdraw liquid assets so you can survive a few months
If your ex-partner becomes vindictive, withdraw enough cash from your account so you have enough to pay for bills, child support, groceries and daily life until a settlement is reached. Proceedings can take a long time, so it can be good to withdraw more than you think you will need for a few months.
- Call police if you need a restraining order
If you are concerned for your well being, or the well-being of your children, you can call the police to obtain an AVO, known as a restraining order. In the event you call the police as you fear for your safety or well being in your ex-partner’s presence, the police may issue an AVO automatically, which can only be lifted by the police themselves.
Divorce may be the hardest time in your life, but by following these steps, you can protect yourself to get the best outcome for you and your family.