Factoring Your Finances In A Separation:

Financial Planning is all about planning for a broad spectrum of eventualities. Its aim is to support you not just with your money, but with everything from helping you finance those hopes and dreams right through to the hard stuff – losing a loved one, living through a global pandemic, or handling your finances in a separation.

During a separation, focussing on your future can be difficult. It’s so easy to get bogged down in the here and now, especially if your separation is contentious. But, it is important to fully understand your specific financial situation so that you have a solid base to move forward from. All too often, this gets left until the last minute. But, the earlier you start factoring your finances in a separation, the more favourable the outcome will likely be all round.  Here’s a few pointers to get you started:

your finances in a separation
Time is of the essence

In any divorce, your assets are going to need divvying up. So, you must understand what they are and how they work. While splitting them 50/50 may initially sound the fairest option, it may mean you don’t get an equal share over time. 

budget
Work out a budget

This is true of any stage or event of life. But, during a separation, budgeting will come into its own like never before. You’ll likely know how much you earn each month (yes, we’re all familiar with how much we have to spend!). But, do you know where it all goes each month? Keeping track of your expenses will help you develop a realistic monthly budget while also allowing you to spot potential saving areas. You’ll then be able to factor in any new requirements and see what they mean for you as your life changes.

tot up cost
Tot up your new cost of living

 It may be that your separation will mean greater change for you than you first thought? Had you been planning on staying in the family home, but have subsequently realised you cannot. Whatever your situation, you will need to scope out the cost. You won’t want anything to catch you off-guard when you’re finally free to step out on your own.

check your settlement
Be sure that any settlement works for you

When emotions are running high, it’s easy to just want a settlement over and done with. But, it is crucial that any settlement you agree upon works for you. So, be sure to take the time to test what it means for you. Look at the offering objectively before you agree to it and check that it meets all of your needs. This may mean you need to seek the advice of a financial expert in divorce proceedings who can run a lifetime cash flow forecast for you to reveal the true propriety of what you have been offered. 

your finances in a separation - objective
Stay objective or seek help from an expert who can!

No matter who you are, separation is an emotionally charged experience. So, there is no shame in not being able to remain objective. The difficulty comes when that lack of objectivity interferes with those things that would otherwise be in your best interest. So, if you are find it hard to remain objective about how to split your assets, remember to do yourself a favour and allow an expert to handle it for you. 

At Lewis Brownlee Financial Services, we have our very own Resolution-accredited financial expert. So, if you need some help splitting assets or would like to infuse some objectivity into your settlement, do give Alex Welsh a call on 01243 767 469. He’d be very happy to see how he can help, so do get in touch!

Written by Alex Welsh

Alex is a Resolution-accredited, Chartered financial adviser. Having joined the firm in 2012, he has extensive knowledge of all areas of financial planning.

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