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Getting your finances sorted after a divorce

Written and accurate as at: Feb 14, 2024 Current Stats & Facts

For some people, the financial impact of divorce can be as devastating as the emotional impact. Having to start over in more ways than one can be nerve-wracking, but there are a few things you can do to get yourself back on firm financial footing.

Untangle your finances from your ex-spouse’s

One of the first orders of business might be cancelling any bank accounts or credit cards you jointly hold (or, if you plan to do so at a later date, introducing a co-signing system for when either of you needs to withdraw money).

Just be mindful of any direct debits you have linked to these accounts. It might be worth scanning your bank statements from the past year so you don’t miss any when setting up alternative arrangements.

Seek out legal advice

This is especially important if you weren’t too involved with managing your household’s finances while you were together. A lawyer will help you understand what your rights and obligations are as you hammer out the details of your separation or divorce. You might also be able to receive free legal advice by contacting a community legal centre or Legal Aid agency.

Divide your property

At some point, both you and your ex-spouse will have to think about how you’ll divide your shared assets (think the family home, car, and other valuables). If you can both agree on who gets what, you can apply for a consent order to formalise things. This is usually the best case scenario.

If you can’t reach an agreement, you might have to apply for a financial order.1 This is an order made by the court laying out how property should be divided, after taking into account you and your partner’s unique circumstances. Once a financial order is made, the parties involved must do everything required of them by the court.2

Keep in mind that there are time limits for applying to the court. Married couples will have 12 months from the divorce order (or a decree of nullity) to apply, while de facto couples will have two years from the date the relationship broke down.3

Sort out your mortgage

Things can get a bit tricky if you and your ex-spouse were still paying off your home when you decided to separate. Your home forms part of the divorce settlement, and since the mortgage is secured over the home it generally also forms part of the settlement. Ideally, you and your spouse will be able to work out what you intend to do with it and have that included in your agreement. Some options include:

  • Sell the property and split the profits between you
  • Have one party buy out the other (in which case the mortgage must be refinanced)
  • Come up with a custom arrangement that suits your situation

Revise your Will 

Your ex-spouse will most likely feature prominently in your Will (as a beneficiary and possibly executor), so it’s a good idea to review things to make sure your belongings go where you want them to when you pass away. 

As divorce generally revokes a will, you might need to revise yours ahead of the divorce actually happening, otherwise any changes might get revoked when the divorce is finalised.

Beyond your Will, you might also have to revise your:

  • Enduring Powers of Attorney: which authorises someone to manage your financial and legal affairs on your behalf if you lose the capacity to do so yourself
  • Advance Care Directive: which informs doctors and loved ones of the type of care or treatment you’d prefer if you’re no longer able to communicate or make the decision yourself
  • Enduring Guardianship: which authorises someone to make lifestyle, health and medical decisions on your behalf if you lose the capacity to do so yourself.

Review your nominated beneficiaries for super and life insurance

It’s recommended that you review your superannuation and any life insurance policies you’ve taken out after a major life event, and separating from your partner certainly fits the bill. Death benefits typically aren’t covered by your Will, so it’s a good idea to check who you’ve nominated as your beneficiary and amend it if necessary. 

Keep in mind that when you end a marriage or de facto relationship, your former partner no longer qualifies as your spouse. Generally, this means a beneficiary nomination for the former partner will become invalid, unless that person satisfies the definition of financial dependent or an interdependency relationship. 

Get to work building up your savings

Along with any costs incurred in the process of separating (such as lawyer fees and divorce application fees), you’ll have to continue paying all your usual bills and expenses, but without the benefit of an additional income. To make sure you can cover these, think about ways you might be able to boost your savings.

This might involve temporarily decreasing spending on non-essential items and looking for cheaper plans on things like electricity and internet. This might seem like a chore to begin with, but building up a savings buffer can be a big part of regaining your financial independence after splitting with your partner. 

At the end of the day, even the most amicable of divorces can still be emotionally draining. Make sure you give yourself time to process events, and don’t hesitate to take a step back if you feel your mental health is being affected. 


1 Federal Circuit and Family Court of Australia
2 Federal Circuit and Family Court of Australia
3 Federal Circuit and Family Court of Australia

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