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Securing your Financial Future before Divorce and Separation

The financial implications of divorce are oftentimes black and white. A divorce costs money and takes time – two variables that are sometimes unpredictable.  The emotional and psychological upheaval associated with divorce and separation is also a process. It will take time to emotionally digest everything that is going on in your family. 

But one of the core aspects that will need attention is finances and splitting assets appropriately. Lack of financial planning can significantly complicate the lives of those affected by the divorce, including children. Before filing divorce forms, here are six steps that can help guide you through an Ontario divorce and offer direction to planning for your future after divorce.  

1. Decide whether you and your partner want a negotiated divorce.

Can you communicate with your spouse comfortably? Do you want to minimize hostility during the separation process? Is there still a level of mutual respect between you and your spouse? If so, there are a few approaches to having a dignified divorce that will help minimize attorney fees and other costs associated with divorce such as: a mediated divorce or collaborative divorce.

A mediated divorce encourages spouses to both sit down with a neutral mediator to discuss and define the details of the divorce and issues of concerns around child custody, spousal and child support, property division. A divorce mediator is a neutral third party that helps couples reach a mutually-agreeable resolution and doesn’t necessarily have to be a lawyer. This option offers both parties control of deciding on what will be best for family and is quicker and less expensive than involving the legal system.

Collaborative divorce is a method of resolving dispute with civility and without going to court. Collaborative divorce promotes respect and lessening hostility between parties.  The goal of this approach is for parties to reach a viable separation agreement through mediated discussions with their respective counsel. This can also include financial planning and the use of parenting coordinators to assist in the decision making process.

2. Protect your child or children’s financial future.

Even after divorce, both parents are equally responsible for their children. Under Ontario divorce laws, whether a couple is legally separating or going through a divorce, each partner is required to support children under the age of 18 and even potentially during the child’s post-secondary education. If you do not have sole custody of children, the amount of child support paid is based on your income and the number of children in the family. Be sure to establish the details of child support to prevent unnecessary financial stress.

3. Division of assets.

A detailed list of all family assets should be created before seeking legal counsel and should include property, investment and insurance details. If a decision cannot be reached mutually, assets can be divided based on spousal contribution.

4. Division of household items.

Home appliances, furniture, television sets, bedroom sets can be split by couples. Although some items have little-to-no resale value; not having to repurchase all household items after post-divorce will alleviate excessive spending once couples separate.

5. Plan for the future.

In Ontario, the law views relationships as financial partnerships.  When a relationship breaks down, the individual who has more assets or makes more money may have to help support the other, and is expected to alleviate financial hardships and support the financial costs of caring for children.

Further divorce information can be obtained by meeting with an expert collaborative family lawyer at Epstein & Associates. As a collaborative practice, we would be happy to provide a complimentary consultation to discuss the best ways to help you protect your financial assets and plan your financial future.