You’re newly divorced or single after years of deferring all financial responsibility to your husband/partner or splitting them between the two of you. You’re now on your own, and need to regain control. Where do you start? Samke Mhlongo tells us.
Get divorced without going broke
November is one of my favourite months. When I think of it, corporate yearend functions, get-togethers with friends, short dresses, long cocktails and weddings come to mind! Whether it’s traditional (by the way, when did white All Stars become the traditional wedding uniform?), or “white” weddings, November and December seem to be South Africa’s nuptials season. But, as much as we love weddings and all the pomp, fuss and #siyashadisathings (#weddingthings) that come with them, the sad reality is that divorce is on the rise. Statistics South Africa released a report in June 2018 showing that 4 in 10 marriages end in divorce within the first 10 years. And, even with its commonness, divorce continues to be a decision and process with a lot of stigma attached to it. Although weddings are a big celebration, the trauma of divorce is often faced alone, and away from the people that celebrated the union. Being a divorcee myself, this is something I know all too well. Not only do you battle with emotional trauma, but the way it wreaks havoc on your finances is like nothing anyone can prepare you for. With this month’s column, I aim to help you be more prepared to face divorce, and come out on the other side a stronger, successful and more financially secure individual. Let’s get straight into it!
UNCOMFORTABLE TRUTH #1: MEN PLAN FOR A DIVORCE
Although a scary thought, the reality is that more men than women prepare financially for a divorce, both in the marriage and before! Divorce lawyer Gift Mncube of Mncube Law Inc has dealt with many cases where a female client’s husband has unfairly improved his financial position prior to the divorce proceedings. One example is that of a man buying the marital home in the name of a third party relative. In this way, the marital home does not form part of the joint estate, even though in most cases, joint income was used to improve and maintain it. On the other hand women tend to be more trusting and transparent with their finances, giving their spouse access to their assets and making it easier for them to put together a list that they can lay a claim against.
UNCOMFORTABLE TRUTH #2: THE COST CAN LEAVE YOU HELD HOSTAGE
Many women suffer domestic, emotional and financial abuse at the hands of their husbands.
Many have relinquished their financial independence to be a wife or a stay-at-home mom. Sadly, this is a vulnerable financial position, and Gift has seen a number of cases where a housewife or woman earning significantly lower than her husband will initiate the divorce process, but be caught without the money to continue, thus having to drop the application. Another tactic that Gift sees men employing is to financially frustrate the divorce process by dragging it, so as to exhaust your finances, and leave you with no choice but to drop the case or seek free legal advice via Legal Aid. A divorce can get extremely messy, taking an average 2–3 years to conclude. In that time, you must not only service expenses previously calculated on a joint income, but also budget for ongoing divorce laywers’ fees. As scary as this thought is, there are ways you can protect yourself and cushion the potential financial blow on your life.
SEEK PROFESSIONAL HELP
Abu Addae, CEO of financial planning company LifeCheq, suggests seeking professional help, and speaking to an independent adviser that will “consider your whole set of circumstances”. Abu adds that this includes having a conversation focusing on major life decisions you’ll need to make, such as whether you stay in the marital home or move, possible career changes, how to handle family responsibilities and other lifestyle adjustments. It is also beneficial to see a psychologist to ensure that the healing happens from the inside out, and doesn’t manifest itself negatively on your finances.
BUDGET FOR THE
COST OF DIVORCE
A lot of women do not calculate the cost of a divorce before embarking on it. They often find themselves having to drop the application and carry on in the matrimony with the man they were trying to leave, or proceed with the application on compromised terms. They end up settling for much less than what was due to them. Independent certified financial planner and career coach Vumile Msweli says one of the major transformations that tend to happen after divorce is the reprioritisation of careers. “In rebuilding themselves, I see many of my clients drive to diversify and increase their revenue streams to service the same expenses with half the income they are accustomed to,” she adds. Abu warns that a wrong move, such as a badly timed home buying decision or career change that doesn’t consider your full circumstances, can quickly unravel your finances.
BEFORE YOU WALK OUT
Divorce is extremely painful, and there is no need to also add a financial burden to it. In order to make it a little more bearable, plan for your exit by investigating attorney fees and their payment terms. And, start thinking of ways of creating, supplementing and/ or growing your monthly income.