Sadly not all relationships last the distance and, alongside considering the important details such as where your children will live and what will their arrangements be for spending time with each parent, there are some other important factors to bear in mind.
You should consider giving your separation an MOT as a priority. As a specialist family lawyer I often tell clients to give urgent consideration to a number of aspects including the following:
Credit cards and bank accounts
Has your partner or spouse had use of your credit card when you were living happily together? Now that has changed, you may wish to review this facility. Is there a risk they will run up a large bill in your name which you will be liable to pay? Consider this immediately. It may be sensible to withdraw the second card to avoid being exposed to a debt you may struggle to pay.
Similarly, the joint account may well have been the main place all money was paid and withdrawn. It may now be wise to either place a limit on what overdraft, if any, can be run up or, if there are substantial funds in the account, ask the bank to enable withdrawal only with joint signatures. It is easier to prevent an overdraft being incurred and preserve capital than to try and get it back once it has been withdrawn or spent!
The Family Home
Probably the most valuable asset you and your partner or spouse own together is the family home. Whilst what will happen to it in terms of it being sold and maintained is vital, you should also be thinking now about the current ownership of that property and whether it needs to be reviewed.
Most couples will own jointly owned property as joint tenants which means that each person owns the whole property. If one of you dies, the property automatically passes to the other joint tenant, which is known legally as the right of survivorship. In a tenancy in common, if one of you dies, the deceased's proportionate interest in the property (be it 50%, 30%, whatever...) will not pass automatically to the survivor. Instead, the deceased's Will determines who takes the interest... provided, of course, they write a Will. If they do not write a Will, the interest is distributed in accordance with the laws of intestacy.
If you currently own the property as joint tenants, you can choose to sever the joint tenancy so that you own the property as tenants in common. This is relatively easy and involves giving written notice to your partner or spouse and then registering this at the Land Registry.
However, before you launch straight into asking for this to be done, bear in mind that this then creates a presumption that you own the property in equal shares which may actually not be what you want to argue when it comes to your financial case on divorce. For this reason, you should consider carefully with your lawyer whether this is what you really want to do.
You must also at this point review the provision in your Will for your husband/wife/partner as, if you sever the joint tenancy feeling confident and pleased that you made this decision, but do not make a Will leaving your share to a beneficiary of your choice, then you run the risk of your next of kin, under the intestacy rules that would then apply, being a quite different person to whom you had in mind!
I often say to my clients that it is the “who gets run over by the bus first discussion”. You need to think how you would feel if your spouse or partner got run over by the bus and you then found yourself owning your home (which you assumed would be entirely yours in the event of their death) with a third party. That might not be your children, whom most people would choose, or even a family member but the new girlfriend or boyfriend. What a nightmare!
It is for each person to decide whether or not to maintain the joint tenancy until financial matters are resolved. You cannot assume your partner and spouse will make the same choices you do so it is worth knowing the options and to be prepared.
Making or reviewing your Will
The other major factor people often fail to consider in the aftermath of their separation is their Will and what provisions have been made. Whilst you are married your spouse is most likely to be the person appointed in your Will to be your executor and will be your prime beneficiary. For most separated people this is not what they want. It is for that reason that my advice is to review your Will and make or update your Will upon separation and certainly you must do so when your divorce is finalised.
I so often hear people say that they haven’t got around to making a Will yet or that they feel it will be a bad omen but it is just another practical job on the list that needs doing. You wouldn’t, for example, forget to get your hair cut regularly or maintain your home, so why fail to maintain or review something at this basic level that could have such an enormous effect on those around you that you love. Of course hopefully you will be absolutely fine but just imagine if you are not…and the implications that could have for your family and loved ones. To find out more about updating your Will, please contact a member of our Tax and Estate Planning team.
Deaths in service benefit and pension nominations
If you have death in service benefit at work or a pension, then you will probably remember having nominated a person (usually your spouse or partner) to receive that benefit in the event of your death. This may be lodged in the dim and distant past of your memory but now needs to be re-considered. This is the time to review these benefits and consider changing your nominations to your children or wider family. A relatively easy step and one that you should be able to manage without legal assistance I am sure you will be pleased to hear!
Of course there will be times when you will need legal assistance and here, at Whitehead Monckton, our specialist family team has a wealth of experience providing guidance and advice in all areas relating to your separation or divorce and our Tax and Estate Planning Support Team can also assist you in relation to making or reviewing your Will.
If you wish to discuss any of the points raised in this article, please contact our Family Team.