7 Ways to Save Money During Your Divorce

Divorces can come with huge financial complications if you’re left feeling unprepared. In this article, we’ll provide 7 ways you can cut down the costs of your divorce…

Divorce is no easy ordeal, as not only are you separating from your partner, but you also have the stress of arranging everything else. From living arrangements and visiting orders (if there are kids involved), to actually financing the divorce itself, there’s plenty to consider.

In recent years and months, a number of cheaper alternatives to traditional divorce processes in the UK have emerged. Collaborative and mediation laws, such as a no fault divorce process, are not only far cheaper than a court battle but offer a far more dignified and less-conflictual approach. Other cost-effective alternatives include DIY divorces, where you fill in the court forms yourself with little to no help from a solicitor.

Aside from weighing up the different divorce options in order to cut costs, there are also plenty of other things you can do. These include hiring a financial advisor or closing the shared bank accounts to save money. To find out some ways to save money during a divorce keep reading…

1.  Start an Emergency Fund

You can start an emergency fund by opening a savings account or, if you already one, you could open a second saving account that you could use just for emergencies. Emergency funds are always a good idea, but especially during a divorce where your assets are on the line.

In the unfortunate event you lose more money than expected during the divorce proceedings or maybe most of your assets are held only in your spouse’s name, setting up an emergency fund will provide you with a greater sense of security and something to fall back on.

2.  Claim Child Benefit

If you and your spouse have kids together, and you receive child benefit, hold on to any receipts detailing the allowances. Essentially, the recipient of the child benefit will be entitled to child maintenance costs from the other parent.

Additionally, if you are a low earner and have a child under your provision, you can claim child tax credits on separation. Child tax credits can be worth a few hundred pounds a month, and child maintenance costs from the other parent are not taken into account when receiving these allowances.

3.  Separate Your Bank Accounts

Closing the join account will not only grant you further financial independence, but also prevents your spouse from misusing your shared finances. Frustratingly, the courts don’t tend to recognise this kind of misuse when dividing your assets. Therefore, it is important to separate yourself from your spouse’s finances as soon as possible.

Additionally, having full control over your finances means you can budget more and no longer have to take into account your spouse’s spending habits and costs. The sooner you close the joint account, the sooner you can start saving and preparing for post-divorce life.

4.  Track Expenses

Keeping track of your expenses is not only a good idea for helping build a budget post-divorce, but is also important for your lawyer and, later, the judge. This will help them decide how to split assets and debts, as well as whether to award child support.

Things that are important to track include:

• Household bills
• Childcare
• Home Maintenance
• Entertainment
• Clothing
• Petcare
• Transport
• Entertainment
• And anything else you usually spend money on

You can keep track of these expenses through your bank and credit card statements, as well as using past statements to estimate past and future expenses.

5.  Don’t Move in With a New Partner

By all means, move in with a new partner after the divorce has been finalised, but it is important to not take the plunge and up sticks during the process. Essentially, their income and finances will be taken into account in the court proceedings, and you could lose money as a result.

6.  Choose the Right Lawyer

This may seem like a fairly obvious one, but picking the right lawyer may save you time and money. In the long run, it may also provide you with a higher chance of receiving the outcome you want.

Ideally, you want to seek a lawyer who specialises in collaborative and mediation law, as this law favours a non-conflictual approach. These approaches tend to work out far cheaper than traditional divorce processes.

7.  Hire a Financial Advisor

Instructing an independent financial advisor (IFA) can provide useful and impartial advice based on your individual situation. They can help optimise financial decisions concerning your pension, mortgage and investments. In the context of divorce, IFAs can be a lot of help navigating the financial element of your separation.

Ready to Tackle Your Divorce Finances?

Going through a divorce can be an extremely difficult and emotional time for many people. Organising your finances and cutting the costs is one way to alleviate a lot of stress. In order to do this efficiently, hiring the right lawyer, keeping track of your expenses, and claiming any extra allowances, such as child benefits, can help you to get on the right track.

Please be advised that this article is for general informational purposes only, and should not be used as a substitute for advice from a trained financial or legal professional. Be sure to consult a financial advisor or lawyer if you’re seeking advice on your finances or divorce. We are not liable for risks or issues associated with using or acting upon the information on this site.

Photo by engin akyurt from Unsplash
Photo by Towfiqu barbhuiya from Unsplash
Photo by Towfiqu barbhuiya from Unsplash

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