My relationship has ended – what do I need to do to regarding my finances?
The break up of a relationship is a stressful time. Along with the emotional impacts, there is the matter of sorting your finances.
Whether you are enduring a relationship break up, a separation or a divorce, there are several financial factors to take into consideration. All of which can have a lasting impact on your financial future if not handled correctly.
1 in 5 women fall below the poverty line as the result of divorce. We are here to help avoid this situation.
From the division of your assets through to your dependents, let’s look at the individual financial items to take into consideration.
These items can be tabled in discussions around how you will handle these costs and the division between parties.
Financial Considerations following a relationship breakdown
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Moving costs
Likely you will incur moving costs if one (or both) partners and children are vacating the current family home.
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Payment of bills
How will bills be paid and how will they be divided between the parties? You may also need to consider redirection of mail.
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Debt repayments
How do you intend on repaying your current debts? Think of your mortgage, car or personal loans, credit cards and the like.
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Childcare and schooling
If children are involved, you will need to discuss who will pay for their ongoing childcare and schooling, or how you will split this cost.
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Division of property and assets
Along with your children, the division of assets is often the more complex task. What assets do you own and how will they be split among parties. Will you sell your assets and divide the profit, buy the other person out or contribute to the repayments?
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Ongoing fees
Consider fees for ongoing care such as counselling (for both yourselves and your children if/as required).
Your financial to-do list
Once you have discussed how you will handle the above finances, it is time to make some changes to your financial set-up.
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Change bank account names
If you have joint accounts you will need to set up separate bank accounts and close down any joint accounts.
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Change super beneficiaries
Your spouse may be your nominated beneficiary in your super account. Check out our recent article on binding death benefit nominations.
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Change your will and Enduring Power of Attorney (EPA)
Your will and EPA will likely change so be sure to update this as soon as possible.
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Update your professional network
You may now look to engage your own network of professionals to help you through this time including an accountant, financial adviser and solicitor.
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Centrelink entitlements
Update your details with Centrelink, and check if you are now eligible for any centrelink payments due to your new living situation. You will also need to update this when you submit your annual tax return.
If you would like assistance working through these matters, please give our friendly team a call to discuss your options. We can help with all the above issues as well as discuss the tax implications of your divorce or separation. We can help you to avoid or minimise lengthy and costly mistakes to put you in the best financial state possible.
