Is a 50-50 divorce split really what you think it is? Paula Ryan explains:
Is a 50-50 uncomplicated divorce split really as simple as you think it should be?
Financial Planner Paula Ryan answers that question:
Certainly if you are looking to sort out the divorce finances yourselves, it may be worth having a quick ‘coffee chat’ with me, so we can look at the tax implications, the best way to split the assets, and also looking at the pensions.
It’s not always as simple as splitting pensions half and half. It might not look as if you have that much in the pension pot – but what matters is how you utilise that going forwards and getting the best outcome financially in the longer term. A longer term view – using a financial plan based on cash flow forecasting, is a good way to achieve this.
I also encourage divorcing clients to look at the protection they will need. What happens if you pass away or your spouse passes away? Having a check list and talking it through all eventualities, making sure you have covered every angle and thought about the implications, is time well spent.
Other questions I help clients find answers to are: “why might I not get that mortgage?”, “how do I avoid that tax bill I might not need to pay if we structured things differently, as my tax liabilities change depending on my marriage status?”
You might think it’s just 50/50, right down the middle. But finances can be quite complex, and a simplistic approach may not leave both the couple who are divorcing with the best options. They may have property portfolios, and overseas investments.
A simple clean cut down the middle approach, may not take account of long term rental incomes, or potential growth at a certain point. Keeping properties or businesses in joint ownership with a legal agreement in place, might be a better solution. Short term implications must be weighed against the long term effects on the children, the tax situation etc.
Taking a more sophisticated, long-term approach still allows a couple to get divorced, whilst at the same time separating the assets at the point when it’s best for everyone concerned, with a clear legal agreement in place to ensure that no-one changes their minds later on!
The value of an investment with St. James’s Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up. You may get back less than you invested.
The first meeting is a no obligation financial review
Paula Ryan DipPFS
Paula Ryan Wealth Management
Tel: 01293 553297
Mobile: 07841 342387
The Partner Practice represents only St. James’s Place Wealth Management plc (which is authorised and regulated by the Financial Conduct Authority) for the purpose of advising solely on the Group’s wealth management products and services, more details of which are set out on the Group’s website www.sjp.co.uk/products. The ‘St. James’s Place Partnership’ and the titles ‘Partner’ and ‘Partner Practice’ are marketing terms used to describe St. James’s Place representatives.