While many of us never intend to get divorced, unfortunately it’s true that many marriages do break down and there is no choice but to file for legal separation.
In fact, there are around 118,000 divorces every year in the UK, with almost half of these occurring in the first 10 years of marriage.
Despite this, a recent survey by Partnership has revealed that getting divorced is one of the biggest financial regrets in the UK. A survey of 40 – 70 year olds found that it was the 3rd biggest financial regret (13%) behind not saving enough (36%) and not saving enough into a pension (25%).
What is interesting though, is that the number is lower for those aged between 40 and 50 (8%), but increases for those at pension age (16% between 50 and 70 years of age). The number of those who regret not paying into a pension also rises to 29% in retirement age, as people realise that they may not receive the expected amount from an annuity as they originally thought.
There is supposedly a rise in ‘silver divorces’ as couples retire and have to spend more time together than they are used to; cracks begin to show and the relationship can start to break down leading to divorce.
It is never worth staying in an unhappy marriage, for your own sanity more than anything else. With this in mind, we’ve looked at the ways in which you can keep your costs down as you go through divorce proceedings.
Always take your time when thinking about what lawyer to use; not only will emotions (either angry or upset) cloud your judgement, you’ll be able to figure out what sort of legal aid you require, what your options are, and what questions you need to ask. Also, changing your lawyer part way through will have major financial implications, as you’ll have to start the process again from scratch.
To keep costs to a minimum, be well prepared before any meetings or phone conversations. Wasting time asking things that you can find out beforehand will end up costing you more in the long run.
Listing your financial assets for example, can be a lengthy process so if you can figure this out on your own beforehand, it’s less time and money spent with a lawyer. Asking questions via email can also be more helpful, as it’s generally quicker and you have a paper trail of all correspondence too.
A tax specialist and financial planner will advise you of any tax implications, particularly if there’s a decent amount of money at stake. They’ll also provide you with tips for minimising any of the tax costs.
If there is a pension involved – either an existing annuity or funds in income drawdown – they will be able to advise you further on your available options.
It’s essential to keep your emotions in check when going through a divorce, as not doing so could lead to you making heated decisions that could have financial implications.
Many couples and up fighting over things that don’t really matter to them, purely out of principle (and, let’s face it: spite). Plus, the more you argue, the more money you’ll be spending on your lawyers.
It also always pays to settle out of court. A litigated divorce (when a judge gets involved) can be hugely expensive.
Try to come to an agreement with your ex without involving lawyers, and you’ll cut down the time (and cost) you spend with them.