Welcome (back) to our Six Stones series. Our financial adviser, Jordan, is sharing as many tips, ideas and advice for people going through a divorce as a humble blog will allow. He’s staying away from specific financial advice – it’s all general advice over here, be sure to get personal financial advice before doing anything – but we hope you find some useful information in here as you navigate through/out of your divorce.
We don’t, as a culture, feel comfortable talking about death.
I don’t know if it’s because we feel that to talk about it makes it more likely, or that we’re all very uncomfortable with our own mortality, but it’s quite odd, when you think about it.
Because there are, as the saying goes, only two guarantees in life – and one of them is that it will, at some stage, end.
Yet we often question what happens after we die.
I can’t speak to the metaphysical side of this big conversation, but I can address the financial one.
And it’s often not very pretty.
Now we’re going to get personal. Bear with me.
Imagine, if you can, that you went to sleep tonight and didn’t wake up in the morning.
Push past the emotional weight of this idea (it’s hypothetical and, I hope, not too resonant of something in your past) and focus on the relatively banal issue of the financial impact.
You obviously won’t be returning to work, so your salary will – at some stage – stop completely.
Yet the expenses of the house – the groceries, utilities, vet bills, petrol, mortgage repayments – still need to be covered.
Even for those that are married, these costs still need to be covered – and I don’t think it’s fair to force a bereaved spouse to return to work early to pay for them.
And for those of you that are divorced – well, who’d cover these costs for your family?
The First Three Months
Let’s put aside the issue of the ongoing costs for your household for a moment. And let’s focus on those first three months after you’re gone.
(Again, apologies for ‘killing you off’ like this).
Now that you’ve passed away, your family will need to make a lot of decisions.
Decisions about funerals and coffins and housing and notifications and wakes and kids and a million other points.
These decisions are being made in a terribly emotional time, of course, which makes them infinitely more difficult.
Not to mention, contentious.
Sadly, turmoil likes this can drag other issues out into the open, to be thrashed out at frighteningly inconvenient times.
Then, after the immediate issues have been addressed – burial, or cremation? What type of coffin? What do you mean, they cost that much? – it’s a matter of returning to day-to-day life.
But the world doesn’t stop, sadly.
So, after a grace period defined by corporate limitations of respect and empathy, the bank will be in touch with your family to work out what they’re going to do with the mortgage.
Do they want to stay in the home?
If so, can they meet the requirements to take the loan over?
Will they pass the new lending assessment?
If not, where will they live?
Do they want to work with the bank to sell the house?
Are there any other loans that need to be sorted out?
At the same time, your executor will be working to obtain probate for your estate. Your estate, it’s worth knowing, is the combined assets and liabilities (what you own(ed) and owe(d)) you’ve left behind.
Probate means that your executor can start liquidating your estate to make sure your final wishes are carried out.
Who’ll look after the kids? How will they pay for it? What assets do you want to pass on, and which ones are you happy to sell?
Oh, and this assumes you’re one of the minority of people that have a valid will in place.
Without that, this entire process is drawn out for many, many more months and invites the government into the situation, wielding your states Intestacy Rules and barking orders like an unwelcome house guest.
This first three months carries a tremendous burden of stress, sadness, regret, grief and uncertainty.
And if not properly considered well in advance, it can also, sadly, bring financial worries too.
In my next post, Louise is back!