When Relationships End

The end of a relationship through divorce, separation or death of a partner can mean significant and often unwelcome changes, particularly when it comes to finances.  This is invariably a time of great emotional stress. During this time you may have to deal with money in a way that you may never have imagined. 

You will need to know where a number of important documents are, and preferably have copies of them. 

• Where are the records of your investments?
• Wills:  Where are they kept? Do both partners have them? If you are going through a separation or divorce, it is unlikely that you will want the ex partner to be a beneficiary, but you probably would want any children to be beneficiaries.  Family trusts may also need to be resettled.
• Family records: Birth and marriage certificates. 
• Are there any pre nuptial agreements or some other marital contract?
• The bank:  Do you have a list of accounts, the cosignatories, credit cards, loans etc? Do you have joint accounts/credit cards/ATM cards? Talking about banks, one of our clients discovered that the bank cut off her access to joint bank accounts, credit cards etc within 48 hours of her husband dying unexpectedly. 
• Debts: Do you know who you owe in loans, credit cards and hire purchase?
• Family Trust: Do you have one and who administers the trust and how is it set up? Are you in fact a beneficiary?
• Home: How much do you owe on the mortgage (if any), who has the mortgage, how much is owing, and what is the frequency and amount of the payments?
• Do you have a list of your personal property?
• Do you have a list of any heirlooms, artwork, antiques and collectibles?
• Do you have copies of tax returns? Who prepares the returns?
• Do you know the names of your accountant, solicitor, investment adviser, insurance adviser?

Obviously some of these are more relevant if you are going through or planning a break up, rather than the death of a spouse or partner.  Experience shows that it can often be difficult for the partner in the weaker financial position (usually the women) to have a good handle on what the true financial position is, especially when the partner is self employed.  The relationships with the professional advisers especially accountants and lawyers are usually stronger with one partner who invariably has been the person that has had the most to do with these professionals.

When it comes to the professional advisers, most of these will be bound by their own professional association’s ethics guidelines.  If there is a matrimonial break-up they are unlikely to be able to act for both parties, as they could have a conflict of interest.  They should however be able to recommend someone who will be able to act for you.

Unfortunately, when there is a marital break-up, there is inevitably a significant decline in one’s financial well being.  Generally one partner will have a lower income and property division further reduces the chance of a new single person saving for their retirement.