The divorce coach: Financial planning is more than numbers

Only recently, support charity Relate released research finding 55% of UK adults think Christmas places added strain on their relationship. Their website user statistics clearly back this up too, reporting that on average they receive a 58% increase in visitors every January.

If you have friends or family in this situation, try to help them acknowledge that relationships can break down, and if they do, understand they are likely to experience disappointment, stress and grief. It could be the most emotionally charged time of their life. But, it’s also a time when some important financial decisions need to be made.

How financial planning helps

At BlueSKY we often introduce people to a specialist divorce coach, an option available for all. After all, in any challenging circumstance if there is specialist advice available we would recommend taking it.

The roles of a solicitor or mediator during the process is well known; they work with you to resolve the immediate situation. Beyond that, however, is where a financial planner steps in.

Financial planning is more than just numbers. We can help people understand the long-term implications of their circumstances and aspirations, and how to address them. We understand it can be difficult to see clarity in the future and are here to help.

Trigger events for financial planning

It’s recommended that you review your financial plan or seek new advice after all big life events. This might be having children, inheriting wealth or retiring. Divorce is the same; it should be seen as a trigger to re-evaluate finances, during and after sharing joint assets.

At an individual level, are pension and retirement arrangements still appropriate? Can ISA tax-free allowances be maximised? If since splitting a marital home someone is sat on a large amount of cash before purchasing a new property, is that receiving interest, or will inflation erode it over time?

It’s also wise to re-evaluate any insurance policies. Jointly held and individual, as the nominated beneficiary to receive a pay-out will likely be an ex-partner. Just because an investment, pension or insurance policy was appropriate before, doesn’t mean it remains appropriate now.

At a higher, holistic financial planning level, it’s always sensible to be looking to the future. Individuals need to identify and understand their goals and aspirations in order to appropriately plan for them. A financial planner can really help with this. The ultimate goal is to improve financial security and achieve peace of mind. Financial planning really is more than numbers.

Visualising your future

Cashflow planning is a great tool for helping visualise the future in graphic form. It demonstrates income, expenditure and overall wealth to identify any shortfalls or surplus. It can also project the potential effect of life events on wealth, planned or unexpected, such as;

  • House purchases
  • Inheriting wealth
  • Losing an income source
  • Retiring

Whilst some events may be more unpredictable than others, we can plan ahead for ways to address and minimise their impact. It could also save time and turmoil during the divorce process, as separating partners may be able to achieve their financial aspirations without fighting for assets.

If you have friends or family that you feel might benefit from talking to us about their situation, financially or otherwise, please do let them know we are available. We can introduce them to a divorce coach, make sense of their future aspirations and put an action plan together.