The Financial Costs Involved in Getting a Divorce
Is has been said before that no one enters into a relationship, be it a partnership, or marriage, with the thought of it ending; and possibly ending badly.
When we are in love our emotions rule, and unfortunately when we look at ending a relationship, be it a partnership or marriage, our emotions rule as well.
Beginnings and endings are all full of emotions.
It is these emotions that can get us in financial trouble, cause us to lash out at the other person, and want to see them feel the pain and hurt we may feel.
Of course in some instances when a relationship breaks down, there may be fault on one of the parties, this only raises the bar on the emotional side of things.
Then there are the finances to consider in divorce and ending a relationship. Rarely do two people come together in a relationship, and then part ways without there being some tying or co-mingling of finances.
Things like owning property together, or having other assets that have been purchased while together, savings, joint accounts, personal possessions, bills, debts, all this has to be divided and broken down and assigned to each person in a divorce or relationship ending.
There is no easy way to divide all this, and divorce can bring about some serious financial implications.
Financial Consequences of a Divorce
As mentioned there are some implications and consequences in the financial arena when you get divorced. Rare are the couple that split with no money issues.
Things like who will pay what bill or debt, especially for jointly held debts, has to be laid out.
If there is property, who keeps the house, do you sell the house, and then do you split the proceeds 50/50 or a different percentage.
If there are children involved, one parent may be required to pay child maintenance, and there may be school fees, clothing, etc.
Then you have the biggie, you suddenly have two people contributing to one (1) household, who now have to maintain two (2) households, and if both were working, without the other’s support.
It is easy to see why divorces get emotionally charged when it comes to money.
Divorce can have a huge impact on your finances, and your credit.
Splitting the Debts…Who Pays?
If you have joint credit cards, overdrafts, loans, mortgage, etc, who pays when you divorce and split up?
If the accounts are in jut one person’s name, then that person is responsible, but who pays joint accounts/debts as you both are equally responsible.
Many divorce decrees will outline who is to pay what debt or account, which is fine, but what if the party the account was assigned to in the divorce fails to pay?
The creditor can come after the other party to attempt to collect the debt. And if the account is in arrears or in default, both parties credit can be damaged.
Just because the divorce decree states Party A is to pay a jointly held debt, the divorce decree does not supersede or take president over the original loan agreement.
So if Party A fails to make the loan payments, the creditor can seek payment from Party B, regardless of what the divorce decree states.
So is there a way to “divorce-proof” your finances?
Yes, but rarely do couples think of these things when they first meet, court, and fall in love.
But there are a few ways to divorce-proof your finances, and one is a pre-nuptial agreement.
Nothing shouts love more than asking someone to sign an agreement relinquishing them of any rights to your money or finances prior to walking down the matrimonial lane together.
I love you, just sign here, and here, and here, and here, and initial here.
One other way to divorce-proof your finances, is to keep totally separate accounts, never to blend or co-mingle any finances in anyway.
Totally separate bank accounts, property, bills, debts, etc.
Then there is the cost of getting divorced, the fees, solicitor’s fees, court fees, they all add up.
The Fees and Costs to Get a Divorce
If you have property and assets, getting a divorce and splitting things up, unless you can both agree to matters, usually means bringing in solicitors, mediators, and this can get costly.
There also is an old antiquated law that states in a divorce there must be blame, one spouse has to take blame or “fault” for the divorce.
This 50 years old law “currently forces couples to find fault with each other”.
And in doing so, and the fact emotions are high, makes some divorces costly, a change in that lw could save some couples £2,000 and as much as £10,000 in fees and charges.
The Head of Family Law at the Co-op Legal Services, Tracey Moloney states, “If ordinarily one party was not in agreement with the divorce proceeding under current law you have to go to court.”
“‘It’s safe to say that by going to court you will encounter a barrister, instructing solicitor and time from work so you will look at thousands rather than hundreds [of pounds] and it will vary from couple to couple.”
Basically what the new law will do is allow couples a “blame-free” divorce or fault-free divorce.
A Partner and Family Law Specialist at BLM, Daniel Jones says, “A date has still not been confirmed for when the reforms will come into effect. The only indication of time we’ve been given is ‘as soon as parliamentary time allows”
“Given the current political uncertainty, it’s difficult to attribute a time frame, but unfortunately it’s unlikely we’ll see any immediate effect”.
“‘Parliament will not be able to give this issue its attention until Brexit has been resolved.”
Unfortunately this old law only makes it more costly to couple who wish to get divorced.
And as we can see, divorces are not cheap anyway you look at them.