If you are considering separating or have recently separated, one of your first thoughts might be, ‘This is going to be expensive.’
While complicated and drawn-out legal matters, especially where the parties disagree, can become costly there are ways you can keep costs down.
Here are a few simple tips that may save you time, money, and anguish.
1. Take the financial initiative
The best thing you can do for yourself is to get as much knowledge and understanding of your current financial situation as possible. If you have left the management of the finances mostly to your partner before, now is time to get across it yourself.
You want to know all about the assets, debts, and expenses you face as a family, and make sure that no one takes control of this money out of your hands unfairly.
Start by gathering information. Take copies of important financial documents belonging to you or your partner such as tax returns, bank statements, insurance policies, wills, and superannuation statements.
Speak with a financial planner to make sure you understand what you are worth and what you will need to survive on an ongoing basis. Seek independent financial advice to your partner, even if you are separating amicably – it is your responsibility to give yourself the best and most accurate information possible.
It is also a good idea to find out from a real estate agent what your home is likely to be worth. If you have joint bank accounts with an ‘either to operate’ authority, instruct your bank that transactions must be authorised by both of you. If you don’t do this, your partner could take action such as removing funds or extending the mortgage without you knowing.
2. Get advice early
Bad choices upfront are emotionally and financially costly in the long run. You may be reluctant to get lawyers involved in this matter, but it is highly advisable that you seek legal advice early and before making any significant decisions.
An experienced lawyer will be able to tell you in your first meeting if any decisions you are planning to make now are a good or bad idea, and advise you which things you really should postpone until you know more or can think more clearly.
3. Communicate with your partner
This isn’t always easy, but the more open and communicative you can be as a couple (even a separating couple), the lower your legal costs will be. This is a natural time for you to stop speaking to your partner and withdraw, but having an open line of communication is the best way to keep legal matters simple and quick.
Try to put aside your feelings and communicate amicably and productively. Both of you will be seeking the most cost-effective separation possible, as well as one which is the easiest on yourself and has the least impact on your children. Despite anything else you are thinking about your partner, you can still work towards these common goals.
You should both try to agree to the value of your assets and liabilities. You may need to sell the family home, wind up a business, or refinance debts.
Reaching agreement on at least some of the issues will save your lawyer considerable time and, in the long run, save you money. If you can agree on a final property settlement, your legal costs can be limited to the cost of drawing up the paperwork.
4. Consider mediation
Mediation is a mandatory first step and can help you to make decisions that serve both of you fairly, without the stress and cost of taking things to court. Mediation is an opportunity for you to face each other and come to agreements about the division of property and care of your children without resorting to arguing.
It provides a good balance of power and allows you to be heard and respected. A good, qualified mediator will help you find common ground, which is something that a court will often do, but only after you’ve burnt a lot of cash and joint assets.
A mediator may often suggest solutions that neither partner had considered. Mediation is often a free service.
There are matters where mediation may not be appropriate, such as in situations of family violence. When it isn’t possible or practical, or when it has failed, your next step should be to attempt to negotiate a settlement through a lawyer.
5. Pick your battles and be willing to compromise
You may have a very good idea of what you want or are entitled to, but you have to consider also the legal costs of achieving your ideal result.
Any legal action will eat into your assets, so it is important to think about whether the contest is worth the potential outcome. Compromise is certainly not always easy, but it usually results in a better, quicker, and less costly financial settlement.
Separating as a couple is incredibly hard, and dividing the property can get very confusing, especially if you have been together for a long time.
It is natural for you to feel overwhelmed in the beginning, but financially, the sooner you can put these five steps into action, the less costly and stressful your legal matter will be.