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Divorce is a complex process that comes with a variety of financial considerations; preparing for a divorce is challenging, particularly when it involves untangling your finances. In addition, the emotional strain can impact your ability to make clear decisions when the long-term consequences are not immediately apparent.

Some areas to consider include creating a comprehensive list of assets, including properties, pensions, investments, businesses interests and other items with a financial value. Fully documenting income and outgoings, both jointly and individually, will help to clarify your financial standing.

You will need to budget for the future, it’s recommended to start saving and budgeting in advance. Obtain a credit report, particularly if you will need a new mortgage or require other borrowing to become financially independent. A credit report will also provide insight into any joint lending or liabilities you could be responsible for post-divorce.

Think about the division of your home, as there are several options for doing this depending upon your financial circumstances. Selling, buying out your partners share, maintaining joint ownership until certain circumstances arise. It is important to consider the financial and practical implications of each option. Ask legal and financial professionals to help assess the viability of each option.

You may wish to seek advice on splitting pension savings, and it is essential that you evaluate your savings and investments prior to finalising a divorce. It is important to note that dividing investments may have tax implications or incur charges. Be aware of Capital Gains Tax (CGT) as it may apply when transferring assets. Under new rules, you have up to three years, from the end of the tax year in which you separate, to make these transfers without creating a liability to CGT.

It is crucial to carefully consider the financial aspects of divorce and it is best practice to seek both legal and financial advice, from appropriately qualified professionals, who specialise in divorce cases. Please contact our team, who are here to assist you in navigating the financial aspects of divorce.

Our experts are here and happy to help, please contact our Independent Financial Adviser, Hannah Heslop.

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