A study by Zurich Insurance found that divorced people are twice as likely to have no savings as married people, and the team at Wirral divorce lawyer Tracey Miller Family Law regularly provide advice on pre-divorce finances to those worried about losing out or missing something important.
Here are just a handful of the finance essentials you may need to check if you’re getting divorced:
1. The division of your respective pension pots
So many couples forget to look at pensions – often the second biggest shared asset you own after property – and how they will be divided following divorce. There are lots of ways of splitting a pension, so it’s a good idea to talk over and understand the options with a divorce specialist or financial advisor.
2. Your life insurance policy and will
If you don’t make adjustments to policies like life insurance that name your ex-partner as beneficiary, your partner could still benefit from them after you separate.
The same goes for your will. It’s an interesting quirk of the law that any will you make before you get married becomes void when you do tie the knot, but the same thing doesn’t happen again when you divorce. It’s up to you to change the terms and beneficiaries of your will yourself, so make sure you contact a family law solicitor to update it as soon as possible.
3. Your credit score
If you and your spouse have a lot of shared and joint assets, you’ll need to start thinking about the health of your own credit score as an individual once you separate. You don’t want to find yourself rejected for mortgages, loans and other credit due to a poor score. Think about closing joint accounts and opening new ones under your own name, taking all the usual measures to build up a healthy credit report.
4. Tax issues
When you’re married (or in a civil partnership), you don’t have to pay capital gains tax when transferring assets between you and your spouse. When you are divorcing, you shouldn’t leave it too long to transfer any assets or you could both lose out. Speak to a specialist for more advice, but you can usually transfer assets without capital gains tax liability within the confines of the tax year (provided you’ve lived together at some point in that same tax year).
For advice on all matters relating to divorce and your finances, no matter how large, small or complicated, please contact Wirral divorce solicitor Tracey Miller Family Law on 0151 515 3036 and we’ll be happy to help.