Separation can be the start of financial woes

The number of couples splitting up tends to go up at this time of year, so it's important to look after yourself financially. Roz Sanderson reports

Unfortunately, the end of the summer holidays also brings with it a rise in the number of people getting divorced, and many people find themselves facing huge, seemingly unavoidable costs.

Protecting yourself financially before, during and possibly after your marriage is critical even if it seems unromantic.

Christine Northam, a counsellor for relationship support charity Relate, says: "The summer is a time for families to go away, and couples tend to put their feelings on hold, but problems in their normal routine become highlighted. Upon returning home some couples will start to realise that the only solution to their problems is divorce."

But, with the Government's recent plans to cut family legal aid, a whole host of financial problems will be aggravated even further, according to Nigel Shepherd of the advice centre Resolution.

"This is a disastrous retrograde step. The only option available to those who currently qualify for legal aid will be mediation," he says.

And if mediation fails to resolve their problems, Mr Shepherd predicts more and more people will be representing themselves in court. "This is a nightmare. Some of these situations are difficult enough to understand for trained lawyers."

However, avoiding the courts can help you save a huge amount in legal fees, and the best way to go about this is by communicating with your partner. "Communication is key," says Mark Penston from Bluesky Independent Financial Advisers. "The best outcomes in divorce cases are those where the couple stay in contact and approach the situation rationally." Naturally this isn't always a feasible option. If the situation is acrimonious, and solicitors start to get involved, then the whole thing can get hugely expensive.

Getting a financial adviser to help you work out what your finances will be like after your divorce may also make some couples think again.

In fact, another way to lower the legal costs and avoid a long drawn-out process is to decide together before you get married what to do with your financial assets in the eventuality of a divorce. Mrs Northam emphasises the need for a premarital agreement. "It makes financial sense and shouldn't be seen as mercenary or unromantic," she says. "It's just common sense."

This is especially true if you have assets that you bought before your marriage that you want to keep separate, although Mrs Northam advises: "Although they are a good idea, premarital agreements might not be right for everyone."

Mr Penston said: "Very few of the people we work with have premarital agreements, as, in the throes of passion, they can appear to be a negative thing. However, if they are sensibly drawn up and rationally thought through they are a good idea."

Many couples who are not legally married but have been cohabiting for a number of years believe they still have the rights of a "common-law marriage". However, no such rights exist and the division of assets is based on legal ownership. So the financial implications can be even more worrying.

Financial expert Jasmine Birtles, founder of Moneymagpie, suggests setting up a legal agreement. "It's particularly important for cohabiting couples, and although it's not a formal legal document it would probably stand up in a court of law," she said.

The effects on women

The costs of divorce can fall pretty heavily on women, especially if they are no longer working and rely on their husband's income. Ms Birtles said: "It takes men about five years to bounce back to their former financial state after a divorce, whereas women often never recover.

"It's a good idea for women with children to go for as much maintenance support as they can, and it's in their interest to get as much as they can in settlement to save for the future."

Mr Penston says: "On balance women do come off worse, but they are far more likely to do well if they seek financial as well as legal advice."

He also advises that although maintenance support is important, if the maintenance payer dies, loses their job or falls ill, then you might suddenly find yourself in a financially compromised position.

To balance this, Mr Penston suggests setting up a bespoke insurance policy to protect against any eventuality.

Deferring divorce

Once the financial implications have been considered, divorce may not seem such an attractive prospect. In fact, Mr Penston says: "Although we normally get a wave of enquiries in September, it might not be the case this year as a lot of people are deferring their divorces in the hope that their assets will recover."

Mrs Northam advises couples not to give up immediately and explains that seeking counselling can often be a good first step. "It might be that it's not as bad as it seems," she says. "It's just that they don't have the ability to sort it out. A lot of people feel as though they've failed if they go to counselling, but relationships are one of the hardest things you have to do."

Compare with the Independent: See how much you could save by switching credit cards. Compare now

Arts & Entertainment
Madonna in her music video for 'Like A Virgin'
music... and other misheard song lyrics
News
Waitrose will be bringing in more manned tills
newsOverheard in Waitrose: documenting the chatter in 'Britain's poshest supermarket'
News
Russia's President Vladimir Putin gives his annual televised question-and-answer session
peopleBizarre TV claim
News
The energy drink MosKa was banned for containing a heavy dose of the popular erectile dysfunction Levitra
news
VIDEO
Sport
Australia's Dylan Tombides competes for the ball with Adal Matar of Kuwait during the AFC U-22 Championship Group C match in January
sportDylan Tombides was diagnosed with testicular cancer in 2011
Arts & Entertainment
Martin Freeman as Lester Nygaard in the TV adaptation of 'Fargo'
tv
News
Posted at the end of March, this tweeted photo was a week off the end of their Broadway shows
people
Arts & Entertainment
tvIt might all be getting a bit much, but this is still the some of the finest TV ever made, says Grace Dent
News
peopleStar to remain in hospital for up to 27 days to get over allergic reaction
Arts & Entertainment
Comedian Lenny Henry is calling for more regulation to support ethnic actors on TV
tvActor and comedian leads campaign against 'lack of diversity' in British television
Finacial products from our partners
Property search
Have you tried new the Independent Digital Edition iPad app?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    1st Line Helpdesk Engineer Apprentice

    £150.00 per week: QA Apprenticeships: This company has been providing on site ...

    Telesales & Sales Support Apprentice

    £221.25 per week: QA Apprenticeships: This company is a well established Inter...

    Client Relationship Manager - SQL, Python

    £40000 - £50000 per annum: Harrington Starr: Client Relationship Manager - SQL...

    **Financial Services Tax**

    £35000 - £50000 per annum: Pro-Recruitment Group: Take your chance to join the...

    Day In a Page

    How I brokered a peace deal with Robert Mugabe: Roy Agyemang reveals the delicate diplomacy needed to get Zimbabwe’s President to sit down with the BBC

    How I brokered a peace deal with Robert Mugabe

    Roy Agyemang reveals the delicate diplomacy needed to get Zimbabwe’s President to sit down with the BBC
    Video of British Muslims dancing to Pharrell Williams's hit Happy attacked as 'sinful'

    British Muslims's Happy video attacked as 'sinful'

    The four-minute clip by Honesty Policy has had more than 300,000 hits on YouTube
    Church of England-raised Michael Williams describes the unexpected joys in learning about his family's Jewish faith

    Michael Williams: Do as I do, not as I pray

    Church of England-raised Williams describes the unexpected joys in learning about his family's Jewish faith
    A History of the First World War in 100 moments: A visit to the Front Line by the Prime Minister's wife

    A History of the First World War in 100 moments

    A visit to the Front Line by the Prime Minister's wife
    Comedian Jenny Collier: 'Sexism I experienced on stand-up circuit should be extinct'

    Jenny Collier: 'Sexism on stand-up circuit should be extinct'

    The comedian's appearance at a show on the eve of International Women's Day was cancelled because they had "too many women" on the bill
    Cannes Film Festival: Ken Loach and Mike Leigh to fight it out for the Palme d'Or

    Cannes Film Festival

    Ken Loach and Mike Leigh to fight it out for the Palme d'Or
    The concept album makes surprise top ten return with neolithic opus from Jethro Tull's Ian Anderson

    The concept album makes surprise top ten return

    Neolithic opus from Jethro Tull's Ian Anderson is unexpected success
    Lichen is the surprise new ingredient on fine-dining menus, thanks to our love of Scandinavian and Indian cuisines

    Lichen is surprise new ingredient on fine-dining menus

    Emily Jupp discovers how it can give a unique, smoky flavour to our cooking
    10 best baking books

    10 best baking books

    Planning a spot of baking this bank holiday weekend? From old favourites to new releases, here’s ten cookbooks for you
    Jury still out on Manchester City boss Manuel Pellegrini

    Jury still out on Pellegrini

    Draw with Sunderland raises questions over Manchester City manager's ability to motivate and unify his players
    Ben Stokes: 'Punching lockers isn't way forward'

    Ben Stokes: 'Punching lockers isn't way forward'

    The all-rounder has been hailed as future star after Ashes debut but incident in Caribbean added to doubts about discipline. Jon Culley meets a man looking to control his emotions
    Mark Johnston: First £1 million jackpot spurs him on

    Mark Johnston: First £1 million jackpot spurs him on

    The most prize money ever at an All-Weather race day is up for grabs at Lingfield on Friday, and the record-breaking trainer tells Jon Freeman how times have changed
    Ricky Gervais: 'People are waiting for me to fail. If you think it's awful, then just don't watch it'

    Ricky Gervais: 'People are waiting for me to fail'

    As the second series of his divisive sitcom 'Derek' hits screens, the comedian tells James Rampton why he'll never bow to the critics who habitually circle his work
    Mad Men series 7, TV review: The suits are still sharp, but Don Draper has lost his edge

    Mad Men returns for a final fling

    The suits are still sharp, but Don Draper has lost his edge
    Google finds a lift into space will never get off the ground as there is no material strong enough for a cable from Earth into orbit

    Google finds a lift into space will never get off the ground

    Technology giant’s scientists say there is no material strong enough for a cable from Earth into orbit