Wealth

Case study: financial control after a relationship

Learn how Joanna took control of her money and rebuilt her financial independence.

When Joanna’s husband left after 21 years of marriage, she was determined to regain control over her finances. Here are the steps she took to ensure she and her children remained financially secure.

Alone after 21 years of marriage

Joanna, 48, had always assumed that she and her husband would enjoy their retirement together. When he left, she was shattered but she also knew that with two kids still at home, she needed to act quickly to maintain her financial stability.

Separating the finances

After 21 years of shared finances, there was a lot to untangle. As a first step, to minimise potential arguments Joanna contacted the bank to make sure transactions on joint accounts now require dual signature and froze their shared credit card.She also set up a new transaction account and savings account in her own name.

The next step was to assess her independent income and list her essential expenses. With this information in hand, she drew up a budget to stay on top of her money. Joanna knew the separation process would take some time, but she now felt confident she had the immediate future under control.

Looking to the future

Joanna was fortunate in that she had a well-paid job and no debts, but she knew she wanted to improve her financial security. She discussed her situation with her licensed financial adviser, and together they drew up a plan that would provide her with a regular income while also building her wealth for retirement. In addition to identifying strategies to maximise her superannuation, the adviser recommended she consider:

Investing in the Select Income Fund to generate a regular income while maintaining stability. Joanna also liked the fact that her investment would help create homes for real people.
Using the Pro-D Balanced Fund to generate income, as well as some capital growth.
Building a diversified portfolio of Australian and International shares, and Cash and fixed interest investments to grow Joanna’s capital while managing her risk.

A young woman walking and having fund with her friends

Acting quickly to regain control

Having a plan helped Joanna emotionally as well as financially. “It would have been easy to push my finances aside when my husband left,” she says. “But acting quickly, getting good advice and setting realistic goals helped me rebuild my confidence, as well as my financial future.”

Tips for managing your finances when a relationship ends

The end of a relationship can leave you in turmoil, especially when there are children and joint assets to consider. The tips below can help you stay on track financially and provide a solid foundation for an independent future.

Tips on how to gain your financial independence after separation

Get expert advice

The financial aspects of a separation can be complex, particularly if you have joint assets. You’ll also need to restructure your finances to ensure you’re best placed to enjoy lifelong financial security. A licensed financial adviser can be an invaluable ally as you work through the changes.

Update your accounts

If you don’t have your own bank account, you’ll need to open a transaction account in your name for your salary and any other income. Don’t forget to make sure that any joint accounts are either closed or change authority on the account so dual signatures are required.

Create a realistic budget

Switching from two incomes to one may not be easy, but a realistic budget will help you stay in control. To get an accurate picture of your finances, firstly gather all the details of your income, assets and debts. Once you understand your financial position, you can start to work out where you can make changes.

Make the most of your assets

If your focus is on building a secure financial future, you’ll want to include regular savings in your budget. You can start with a flexible, high-interest savings account; then, as your balance builds, you can think about building additional income streams or growing your wealth through investments.

Review your insurance and superannuation

Change the beneficiary of your life insurance and superannuation if your former partner is the current nomination. Speaking to a licensed financial adviser can help ensure your insurances are appropriate and identify strategies to grow your superannuation over time.

Write or update your will

It’s never too soon to write a will and now that your relationship status has changed it’s more important than ever. An estate planning lawyer can ensure your assets are protected and your wishes are clearly set out, bringing you the ultimate peace of mind.

Further help and information

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