Taking the First Steps to Financial Independence After Divorce

Divorce is a whirlwind of emotions, legal complexities, and practical challenges. One of the most daunting aspects can be taking control of your finances, especially if you haven’t been the primary money manager in your relationship. The good news? Taking the first steps toward financial independence isn’t as overwhelming as it seems when broken down into manageable pieces.

Here’s how to start rebuilding your financial foundation after divorce.

1. Understand Your Financial Position

Before you can make any decisions, it’s crucial to understand where you stand financially. This means taking stock of your assets, liabilities, income, and expenses. Think of this step as creating a snapshot of your financial life—it’s your starting point for everything that comes next.

What to do:

• Gather bank account statements, credit card bills, and loan documents.

• List all joint and individual assets, including property, vehicles, investments, and superannuation.

• Document your monthly income and recurring expenses.

If possible, create a spreadsheet to organize this information - or even just a list in a notebook. Not only will it help you understand your financial picture, but it will also be critical for any discussions about property settlement.

Why it matters:
Knowing your financial position is about more than just ticking boxes—it’s about clarity and control. When you’re informed, you can make better decisions and advocate for yourself during legal proceedings.

Tip: If gathering financial documents feels overwhelming, start small. Begin with accounts in your name and gradually expand to joint accounts, loans, and other assets.

2. Open Separate Bank Accounts

One of the most empowering steps you can take after separation is opening bank accounts in your name alone. This is about creating a sense of independence and ensuring that your finances are under your control.

What to do:

• Open a operating and/or savings account with a trusted bank.

• Redirect your income (salary, child support, government assistance) to these accounts.

• Review and update any automatic payments tied to joint accounts.

Why it matters:
Having your own bank accounts is a symbolic and practical step toward independence. It separates your financial future from your past and gives you the flexibility to manage your money as you see fit.

Caution: While it’s essential to establish financial independence, transparency is equally important. Avoid making any financial decisions that could be viewed as hiding assets, as this may negatively affect legal proceedings.

3. Take Control of Joint Finances

Divorce isn’t just about starting fresh—it’s also about untangling the financial ties from your past relationship. Joint accounts, credit cards, and loans need to be reviewed and addressed to ensure fairness and accountability.

What to do:

• Notify your bank of your separation and request that joint accounts require both signatures for withdrawals.

• If possible, work with your ex-partner to divide joint funds fairly.

• Pay off or close joint credit cards to avoid future liabilities.

Why it matters:
Untangling joint finances reduces the risk of misunderstandings or financial disputes down the line. It also protects you from unexpected debt that could arise from shared accounts.

4. Seek Legal and Financial Advice Early

Navigating the financial aspects of divorce can be complex, especially when it comes to property settlements, superannuation, and child support. Seeking professional advice early can save you time, stress, and potential mistakes.

Who to consult:

• A family lawyer to help you understand your legal rights and entitlements.

• A financial advisor to guide you through budgeting, investments, and long-term planning.

• A mediator if you and your ex-partner want to resolve financial matters amicably.

Why it matters:
Professional advice ensures you don’t overlook important details and helps you make informed decisions that align with your financial goals.

Why These Steps Matter

The early days of separation can feel like standing at the base of a mountain. But every small step you take—organizing documents, opening accounts, and seeking advice—brings you closer to the summit. These actions aren’t just about managing money; they’re about reclaiming your independence and setting the stage for a secure, empowered future.

Remember:

• You don’t have to do everything at once. Start with one task and build from there.

• Asking for help is a sign of strength, not weakness. Surround yourself with people and resources that support you.

Stay tuned for the next post in this series, where we’ll dive into budgeting for your new life and setting yourself up for financial stability.

I provide personalised advice to help women undertake these steps and to make sure things are set up from the very beginning. The first consultation is at no charge - see my contact details below.