Navigating Financial Planning for Divorce: A step-by-step guide to securing your future

Divorce can be both an emotionally and financially draining experience. The decisions you make during this difficult period can shape your financial future forever; but careful planning and advice can help make the process much easier.

Louise Oliver – Piercefield Oliver’s highly respected financial planner and Resolution member – offers her expertise to help you navigate financial planning for divorce. Below, we share some practical insights into managing finances during divorce, and explore various options that will help you build a stable financial foundation.

Understanding financial planning for divorce

Divorce brings some major financial changes, so it’s vital to plan ahead. Financial planning for divorce means much more than simply dividing assets – it’s all about understanding your financial position now, and preparing for the future. 

But why is financial planning for divorce so critical? In many cases, financial planning helps individuals avoid the emotional pitfalls associated with money matters during a divorce. It enables you to gain a clear picture of your financial situation, and understand what you own, owe, and earn. Financial planning also offers a level of security, allowing you to maintain financial stability during and after the divorce process.

Working with an expert divorce financial planner like Louise Oliver encourages open dialogue between both parties, resulting in less conflict and more positive financial outcomes. By creating a structured financial plan, you can reduce the stress and uncertainty that often accompanies this major life change.

Key financial steps to take during divorce

1) Take Inventory of Your Financial Situation

The first step to navigating financial planning for divorce is taking stock of your current financial situation. List all your income sources, assets, liabilities, and expenses, and divide these into jointly owned and individually owned assets. Don’t forget the less “obvious” assets like pensions, investments, and insurance policies – these often carry significant value, making them vital for inclusion in your financial assessment.

2) Collaborate with All Parties

Although it may not be easy to do so, we highly recommend engaging in an open dialogue with your ex-partner throughout the divorce process. If you are open to working together, you could consider creating a shared financial plan. Or if working together isn’t an option, professional mediation can help reduce conflict between the two of you, and support you to find the most sensible solutions.  

3) Understand Your Financial Settlements

Once all key financial components have been identified, it’s time to seek expert advice from a divorce financial planner on achieving a fair distribution. Remember that financial settlements should consider your future needs as well as your current needs, such as education costs for your children or any potential healthcare expenses.

4) Set Financial Goals for the Future

After the financial settlement has been agreed, you should consider creating a post-divorce budget that includes financial planning for any future expenses i.e. funds for housing or retirement. Establish a financial safety net and build up an emergency fund to provide peace of mind as you transition into this new phase of life.

5) Protect Your Rights

It’s vitally important that you engage with an expert financial planner throughout the divorce process. They protect your rights at every stage and address any shared assets, tax implications, and spousal maintenance needs with ease. They can also help you evaluate your long-term investments and pensions – in many divorces, these assets make up a large part of the marital estate, so thorough evaluation is key to receiving the best financial outcome.

Our financial planning for divorce checklist

If you’re currently navigating the complex process of divorce, here’s a quick checklist to help keep you on track throughout this difficult time:

1. Compile a list of all assets and liabilities.
2. Explore sensible solutions for asset division.
3. Review pensions and long-term savings.
4. Consult a financial planner for settlement strategies.
5. Create a budget for post-divorce life.

Avoiding common financial mistakes during divorce

Divorce often brings many financial challenges, and mistakes can be costly. Partnering with an expert financial planner like Louise Oliver can help you avoid these common pitfalls:

• Emotional decision-making: Emotional stress can cloud our judgement – financial planners provide clear, actionable advice to help you prioritise the most practical financial outcomes. Discover how a divorce coach can empower you through the 7 Cs in our dedicated blog post.
• Overlooking long-term expenses: Failing to consider future implications and expenses can jeopardise your financial stability. Professional planning for divorce enables you to make decisions that will benefit both your current and future financial position.
• Omitting hidden costs: Divorce often brings many unforeseen expenses, such as legal fees or relocation costs. A detailed financial plan can help you fully understand all hidden costs associated with divorce and make realistic preparations for covering these fees.
• Failing to update financial accounts: Many people forget to update their financial accounts following a divorce. A financial planner can help you update your bank accounts, insurance policies, or wills to reflect your new financial circumstances.

How a financial planner supports you during divorce

Divorce marks the start of a new chapter in your life. By offering expert advice tailored to your unique situation, a skilled financial planner can make the divorce process much more manageable. Financial planners act as objective third parties and provide insights grounded in expertise rather than emotion. They can help you make practical decisions that align with your financial goals and values, enabling you to comfortably transition into this new phase of life.

Louise Oliver brings her financial planning expertise to provide a thorough financial analysis of your current and future needs, assist with negotiations to secure equitable settlements, and help you rebuild your financial foundation post-divorce. 

Schedule a consultation today to take control of your financial future.