A separation is when a couple chooses to live in separate places because their relationship has broken down, which is something that can happen to both married couples and common-law couples. As a result, it is not the same as a divorce, which is when a marriage is brought to a conclusion through legal means. Regardless, a separation is something that comes with a fair number of financial issues, with examples including but not limited to the division of their assets, the division of their debts, and arguing over points of disagreement.
This means that people who are going to go through a separation should make sure to read up on the relevant issues beforehand, which should provide them with the best chances of making it through the process in an amicable manner while still making sure that their interests are protected should something go wrong. Something that is critical because said individuals are the ones who are most responsible for their own well-being.
Here are some useful financial tips for a separation:
Run Regular Credit Checks
Some financial specialists have suggested that people who are going through a separation should run regular credit checks on their spouses, which will reveal whether they have been making their repayments or not as well as whether they have been taking on new forms of debt or not. Although this can seem rather excessive, it is important to remember that people who are going through a separation are still considered to be married, meaning that they can be held responsible for the choices of their spouses. In the end, it is better to be safe than to be sorry, though said individuals should make sure that both them and their spouses will be making regular credit checks for the sake of maximum assurance.
Establish Separate Accounts
One of the first things that should be done in a separation is the establishment of separate checking accounts as well as separate sources of credit. While some people can be expected to continue behaving in a reliable and responsible manner, it is important to remember that separations tend to be rather stressful situation, meaning that others have been known to behave in an erratic or even an outright malicious manner. As a result, the establishment of separate checking accounts as well as separate sources of credit are critical for limiting the amount of damage that can be done if something unpleasant occurs.
Respond Fast to Potential Problems
People who are going through a separation should keep a close eye on their spouses and be prepared to respond in a productive manner should a potential problem come up. For example, if someone sees their spouse using their shared assets in a wasteful manner, said individual can ask a court to freeze the accounts, thus limiting the extent of the damage. In other words, monitoring on its own is not enough because monitoring on its own is meaningless. Instead, people who are going through a separation must be prepared to back up their precautions with action should the need come up.
Expect Higher Expenses
Separation means that the couple should be prepared to cut back on their spending. This is because the two will now have to pay for some things that would have been redundant if they were still living at the same place. For example, even if they owned a house outright, one of them will be living at the house, while the other will have to pay for either an apartment or some other kind of accommodation. As a result, people who make no attempt to adjust their spending can come to regret it when they overshoot their budgets, which is something that will come with a whole host of additional issues at a time when they are already struggling to manage a stressful situation.
Get It in Writing
Even the most amicable couples should make sure to get their agreements about the divisions of their assets, their debts, and other financial issues down in writing. This saves them the need to consult their memories, which tend to be rather unreliable in the long run. Better still, it means that people who are going through a separation have a convenient document to fall back on in case they start arguing in earnest with their spouses over their unresolved issues, meaning that it has its uses even if it is one of those things that most couples hope that they will never have to use.
Speak to a Specialist
People who are going through a separation should always make sure to speak with a specialist about the issue. In part, this is because separation is a complicated process that tends to be fraught with emotion, meaning that consulting someone with the right expertise and experience can do a great deal for those who are experiencing it firsthand. However, it should also be noted that different states have different rules regarding how separations are handled, meaning that while reading up on the topic is helpful, it tends to be less useful than speaking with a specialist with a more in-depth understanding. This is particularly important because specialists on separation tend to have resources that can be used for the rest of the process as well, thus ensuring that their clients will be prepared to handle whatever comes their way no matter what happens.
Being Separate But Not Separate
Finally, some couples should give some serious thought to separating but still living in the same place, which is something that can prove beneficial for their finances. For example, most couples can save on housing costs by eliminating the need for either one of them or both of them to find a new place to live. Furthermore, some couples might be interested in making sure that one of them can still get covered by the other’s health insurance. Of course, this is not something that all couples who are in the process of separation can manage, but if it is possible, said individuals should give it some serious thought because of what it could mean for both of their finances.