Early financial advice vital in divorce negotiations

Dealing with financial problems for the first time can be extremely daunting and when they are part of a divorce settlement the emotional pressure can seem overwhelming

Using a specialist financial planner as a member of your “divorce team” right from the start of the process is very important. Not only can this save costs in the long run, but it also ensures you are making the best decision for you and your future.

I recently acted for a 67-year-old client who wanted to establish the best time in the divorce process for her to seek financial advice. She was scared of facing yet more costs on top of the legal fees already paid and had little experience of dealing with the family finances.

This involved working out what would be needed from a settlement for her to be financially “Ok” which meant understanding, monthly outgoings, working out her husband’s pension and which of their individual investments would be included in the “combined pot”.

The client believed that being able to buy a home at £500,000 and generate a monthly income of £2,500 for the rest of her life would be an acceptable financial outcome, however, by using the True Financial Design Visualize Your Future process and system we were able to show exactly what would be required.

This revealed the client had undervalued the cost of maintaining her standard of living for the rest of her life and armed with this information she had the confidence to negotiate the right settlement rather than just accepting the first thing that was presented to her. This also saved money in the long run as TFD were able to liaise directly with the solicitor on the client’s behalf.

The resulting higher settlement allowed her to buy house at 550K and also receive a monthly income of £3,000 - some of which was guaranteed as she received a share of ex-husband’s final salary pension.

True Financial Design offer a free initial discovery call to illustrate how we can help during this challenging time. To book this, please visit our website www.truefinancialdesign.co.uk.

A pension is a long-term investment, the fund value may fluctuate and can go down. Your eventual income may depend upon the size of the fund at retirement, future interest rates and tax legislation.