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The Financial Side of Breaking Up

Relationship breakdowns can be devastating emotionally, as anyone who’s been through it knows. Then, just when you’re at your most fragile and vulnerable, you have to deal with unravelling your finances. This is where we learn that 1÷2 ≠ 0.5, even though we wish it would. Divorce generally means losing money thanks to transaction costs and the need for speed.

No wonder divorce ranks in the All Time Top Five Greatest Hits on the ‘Life’s Most Traumatic Experiences’ Charts!

It’s something I’ve seen play out first hand when my parents divorced. The financial decisions they made as they split rippled through the following decade. Indeed occasional blips are still felt 29 years later by both of them. As a financial educator, I am often asked for suggestions on dealing with the financial side of divorce. (E.g. this 45min segment for Focus on ABC Radio with Jessica Strutt). Read more

Love and Money: Four tips to reduce financial conflict at home

By Lacey Filipich, BEng(Hons), MAICD

My parents fought about money. It’s the main reason they divorced. I can’t conceive of them sharing a household budget so in retrospect it’s not surprising. To put it bluntly: Dad spends, Mum saves. You’d think they’d balance each other out but it doesn’t work that way apparently. The issue was not the actions of saving or spending themselves but what they saved for and what they spent on.

My father has expensive taste: be it a pair of jeans, a bottle of champagne or a car, he only wants the best. He arrived on my doorstep one Christmas, effectively homeless, in his (reasonably new) Mercedes ML350. My mother, on the other hand, is an accountant. She budgets, she plans, she minimises tax. She would prefer to have a $2,000 car and a healthy investment portfolio than a $100,000 car and no investments. Of course, she’d have the expensive car AND the investments, but if forced to choose she’ll pick the ‘smart’ option every time (that’s the investments, in case you hadn’t worked that out…)

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