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Recovering After a Divorce

4 key steps to consider in your financial portfolio

Separation can be an extremely stressful process and with so much going on there are many things to think about. One of the biggest factors to consider is the restructure of all of your finances and insurance to make sure that your portfolio is in line with your lifestyle.

Here are 4 main considerations as you move into this new chapter.

1. Review your Will

It’s the ‘golden thread’ of your financial planning. Your Will is the document that explains exactly how you want your belongings to go after you pass away and can also list your last wishes.

Once you get a divorce, if something happens to you within the first 3 months (and you haven’t updated your Will yet) your Estate will then be distributed in terms of intestate succession – this is essentially a set of rigid rules that’s determined by law meaning that your assets may be divided in a way that is not your intention. After this period, your old Will then takes precedence again which means that the ex may then get all of the assets, if that’s how your Will was set up when you were married.
 

2. Budget and cash flow

It may seem obvious but we often see a lack of budgeting in general. Understanding what is happening with your finances and where your income is going will help with making sure that your money is working for you.

Cohabitating naturally means that certain parts of one’s income are fluid and just becomes part of the household expense, so going out on your own can sometimes come with unexpected costs. A budget will help to track your spending habits now that your money belongs to only yourself.

3. Check in on your goals

With such a big change it’s likely that your financial goals also need to be updated.

It’s time now to take a look at what you want your financial future to look like, retirement planning, rainy day savings, investment portfolio and saving for that trip to a destination your ex wasn’t so keen on. Your needs and goals are specific and your portfolio needs to meet that specifically.

4. Re-evaluate your risk

Going from interdependence to independent changes your exposure to risk. Perhaps you’ve gone from two salaries into the household now to one or shared savings and even assets may now have changed.

It’s important to take a step back and ask if, “something happened to me what would happen to my financial wellbeing?” – what happens if you become disabled and can’t perform your job, become very sick or even die. Making sure there’s a solution to each risk through holistic and careful planning will make sure that you avoid financial impacts if something were to happen.

Change can be overwhelming but partnering with the right people and having a team in your corner makes life’s chapters a bit easier to navigate. Choosing a financial planner is a deeply personal journey, so make sure to shop around and do your research.

 

We have a diverse team with specialisations in all areas of financial planning and pride ourselves on the fact that our planning is personal, unique and holistic. If you’d like a call just to find out some info or even just chat, get in touch below.

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Wealth Creators is a franchise of Momentum and specialises in planning that is tailor made to meet our clients’ needs.

As life changes so should your portfolio, each financial planner on our team is highly trained but also relationship focussed, this means that you will always have a personal touch when it comes to your planning backed by the skills and knowledge to rest assured that your portfolio is taken care of.

To take a look through the team and get in touch, click here.