It's important to fairly split up your joint assets and any shared debt after a divorce.
If you're considering a divorce, it's a good idea to be on the font foot with your finances to ensure you're both happy with the outcome. The sooner you get onto fairly splitting up your assets and debts, the better. Here's some tips to help you manage your finances during and after a divorce. If you're ready to open up individual bank accounts, you can also compare options in this guide.
List your shared assets and shared debts
The first thing to do is create a list of all the assets you share, as well as all of your combined debts. Try to include everything on this list, including any property you own, cars, savings and joint investments like shares or term deposits. Also decide if you want to include personal items in this list, for example any personal jewelry you each own, personal art pieces or antiques.
Once you've listed all your shared assets, you should also list your shared debts. For example any credit cards, if you have a mortgage together and any personal loans. If you have any individual debts, for example student university fees, you will need to decide if these will be included in your list of shared debts or if these will remain separate.
Decide how to fairly split up your assets and debts
If you've both decided a divorce is the right decision for you, you can request a divorce by downloading a Divorce Kit from the Family Law Court or the Federal Magistrates Court. If things are a little more complicated and you are struggling to come to an agreement on a few things (for example how to best split up finances), you can apply for mediation for a cost on only $750 to $1000. This process involved a neutral third party person helping you both work out how to best split things up after your divorce. All you need do in this case is to contact a mediation consultant who may be a lawyer or a psychologist. They will assist you both in drawing up a peaceful and reasonable settlement.
The Family Law Court is the final and most expensive option where divorces can cost upwards of $15,000. When taking this path you will be met with legal costs as well as having to appear in court. The Family Law Court is often the only option if you and your spouse can't agree how your combined debts and assets should be divided. When you go to the Family Law Court for assistance it will be the court that will make any decision on your behalf and that decision will be binding.
It's time to open individual bank accounts
Once you've decided to go your separate ways it's important to start splitting up your finances. If you have joint bank account opened in both your names, consider splitting up the money in that account and closing the account.
You might consider opening your own bank account in your name and getting any income, for example your salary and any benefit payments, diverted into your new account. You can use this bank account for your day to day spending. If you've got shared savings, after you've decided how to fairly split this balance it's a good idea to open your own savings account to deposit the money into. If it's a large balance that you don't need to access, you could also consider putting some or all of it into a term deposit in your name.
Compare bank accounts below
Update your superannuation
Make sure your superannuation is updated in your own name (if you're changing your name after the divorce) and that the beneficiaries are up to date. The beneficiaries are the people who will receive your superannuation in the case of your death, so you might want to change this after your divorce. The same goes with your insurance options and any insurance payouts you or your family might receive. This is easy to do by contacting your super fund, or updating your preferences online.