We are now living longer, and with that many people are not prepared to spend the next 20-plus years with someone they are no longer attracted to. Divorce and separation are never easy, and when it happens later in life, the stakes can feel even higher.

Ensuring financial stability is crucial for silver separators. It’s common for older couples to have different financial status because, in most cases, they have less debt. A main concern for most when thinking about separation is protecting their children’s inheritance. This is where budgeting and long-term planning come in before separating to achieve financial security and peace of mind.

Here are some key considerations:

Know your financial situation

• Know what you jointly own and owe: Assets such as properties, savings, investments and KiwiSaver. Then, liabilities, including mortgages, loans, credit card debts, and ongoing household expenses. List these into a spreadsheet.

• Create an asset list: After knowing what you own and owe, document all joint items that could be considered assets, including smaller items like furniture, jewellery, artwork, cars, boats.  

• Review financial statements: Collect and review copies of tax returns, bank statements and documents that provide information on current finances. Go through accounts for the past 12 months, document mortgage repayments and interest rates [make note of the expiry for fixed mortgages] and list all household expenses for each month. 

• Know all income sources: Determine current and potential future income sources, including superannuation, KiwiSaver, part-time work, dividends, interest.

• Document debt division: Do you have a document [prenup] that lays out any debt incurred before or during marriage/de facto? If so, know how those debts will be divided; if not, know that it will likely be 50/50.

Seek professional advice

• Independent financial planner: A certified and independent financial planner can help create a comprehensive plan tailored to your new circumstances.

• Lawyer: Ensure your lawyer is in your corner and aware of the separation. Ask them what additional things you need to get in line before separating (if you have control) and present them with your financial position.

Evaluate and adjust your budget

• Create a post-divorce budget: Outline your new income to understand what adjustments are needed and cut unnecessary expenses to align with your new financial reality.

• Know what to keep: Know what to protect and what the impact would be if you cancel an expense such as insurance. Insurance removes risk and provides peace of mind and security.

• Emergency fund: Ensure you have money put aside for unexpected expenses. A good idea is to save towards three months’ worth of expenses.

• Revise your investment strategy: Your risk tolerance and investment strategy may need to change. Adjust your portfolio accordingly.

• Revise your retirement plan: Reassess your retirement goals and timeline. Continue to save and boost your KiwiSaver or savings portfolio where you can.

Other things to note

• Work opportunities: Consider part-time or freelance work to supplement your income.

• Know your entitlements: Check if you are entitled to support e.g. child support, government help, and payments in compensation for not working while raising your children.

• Check all tax implications: Does anything you own or owe, e.g. a mortgage, or if you are a contractor or business owner, require tax payment?

• Get educated: Read, read, and talk to people you trust. Find other sources of information and get clued up to make informed decisions.

• Update your will: Update all important information and documents with your new relationship status and ensure your will is up to date.

Bridgette Jackson is a CDC-certified Divorce/Separation Coach with a postgraduate dispute resolution qualification.  She is also a trained divorce mediator (AIMNZ), a Relationship Coach (Institute for Life Coach Training), and a member of the Institute of Executive Coaching and Leadership (accredited by the ICF - International Coaching Federation).  Bridgette is also a Certified Organisational Coach, Level One with IECL (Institute of Executive and Leadership Coaching) and an enrolled barrister and solicitor of the High Court of New Zealand.