Sarah Coles is head of personal finance at Hargreaves Lansdown.
As the festive season gives way to the post-Christmas comedown, divorce season moves up a gear.
The first working Monday of the year – 6 January in 2025 – traditionally sees a surge of divorce enquiries from people pushed to the brink after spending the festive season together.
What is just a date in the diary for divorce lawyers can be an incredibly stressful time for couples going through the trials of a split.
The good news is that by setting things in motion, you should be able to imagine the light at the end of the tunnel, where this no longer occupies all your time and energy.
The bad news is that there’s an awful lot of tunnel to get through first, so you need to do what you can to keep your finances in one piece.
Sarah Coles: Your first priority is damage limitation
On average we divorce 12.9 years after marriage – so there’s plenty of time for things to have got complicated.
When you start the legal process, you can feel you already have enough to worry about, keeping on top of the legal side of things.
However, there are steps you need to take right now to protect your finances too.
1. Draw up an emergency budget
Your first priority is damage limitation. People often run up debts after a split, because they’re dividing the same income between two households – while at the same time paying for what can be an expensive process.
It makes sense to draw up an emergency budget to cut your expenses as much as possible during these first difficult months.
2. Talk to your ex about the mortgage
This also goes for any other joint debts, like car finance.
If you’re both named on the mortgage, then you’re both liable for the full amount, so to protect your financial position you should try to maintain payments in the short term.
If possible, try to agree this between you. If your ex refuses to pay their share, or you’re struggling to pay yours, talk to the mortgage company and see if they will allow you to pay interest-only for a period, or take a break while you sort something out.
> How to deal with debt in a divorce
3. Think about joint accounts
If you’re being paid directly into a joint account, arrange for the money to be paid elsewhere. If there are bills, rent or the mortgage coming out of the joint account, arrange an alternative way of paying these.
Tell the bank holding your joint account about the split and they can make arrangements so you both have to agree to any money being withdrawn.
Similarly they can place controls on debts to prevent either of you from abusing joint arrangements.
4. Check your credit cards
There’s no such thing as a joint credit card. If you both have a card on the same account, one of you will be the primary card holder, and the other has an additional card.
If you’re the primary card holder, you’re liable for spending on both cards.
If this is the case, it’s sensible to block both cards. If your ex is using the card for everyday expenses, they need to know as soon as you’ve done it, so they can find an alternative.
5. Get to grips with the value of what you own
The divorce process involves dividing your assets, so you need to understand the value of it all. This includes pensions. In many cases, it’s one of the largest assets built up during the marriage – often largely in the name of one person.
Couples often offset assets, but it’s important to appreciate the value of what you are giving up and what it will cost to replace it.
It may be worth speaking to a financial adviser as well as a lawyer. This comes at a cost, but if they set you on the right course, it can repay itself several times over in the long run.
> How to split pensions in a divorce: The three main options explained