Seven Unintended Consequences Of Divorce31st May 2017
1. You Think Your Kids Are OK When Secretly They’re Not
And yet many separating parents delude themselves that their children are ‘coping well’ with the break up – even when they’re not.
A Netmums survey showed that only 18 per cent children were happy after a divorce…but three quarters of parents thought the kids had accepted it.
Of the 100 children surveyed, one in five had turned to alcohol, one in nine had self-harmed, six per cent had contemplated suicide and two had attempted it.
Every parent says their children are the most important thing in their lives. And the family courts always put the children’s wishes above those of the separating parents.
But don’t kid yourself that everything’s going to be OK because ‘lots of couples get divorced these days’ and so ‘children are more accustomed to it now’.
The emotional side of divorce can lead to a lot of unintended consequences. And there’s more…
2. Your Children Could Be Cut Out Of Your Will
The moment you get divorced, your will’s provisions for your former partner are no longer valid.
Effectively, you are instantly disinheriting your ex-spouse. The law treats your former partner as if as they had predeceased you – even though they’re still alive!
And if your will says “should my spouse die before me, their share of the estate will go to my children” then that is what will happen.
But if you remarry, this revokes any existing will. Your new spouse will take precedence over any children from your first family.
Under the intestacy rules, your new spouse will be entitled to the first £250,000. They must then share the remainder (50/50) with your children.
So in some circumstances your first family could receive nothing from your estate.
Solution? Make a new will.
But make sure you do it right because more wills are being challenged in court. Why? One reason is the rise in divorce, remarriage and blended families.
Find out more about this from our wills and probate solicitors.
3. You May Be Denied A Passport Or Driving Licence
It’s pretty obvious that you may wish to change your name after divorcing – but few realise how important it is and what it entails.
In theory you can change your name whenever you like – without any paperwork. If you want to be known henceforth by another name then so be it, that’s your new name.
Until you get to the matter of passports, driving licences and bank accounts. For those you need to change your name by deed poll.
It can get particularly tricky at the airport when your passport says one surname…but your kids’ passports have a different surname.
Getting divorced can also affect your immigration status if you’re not a UK national. Not that marrying a British citizen guarantees you a UK passport. It does not.
4. Your Credit Rating Could Take A Hit
Not directly. You won’t suddenly be penalised the moment your Decree Absolute goes through and you cease to be married.
But divorce will hit your finances. The brutal truth is that you will not be as well off as you were when you were married.
You will have to manage on one salary instead of two. And you may end up having to help support your former partner (and any children) financially.
That could affect your ability to pay off your debts – and therefore determine whether any lenders will want to offer you a mortgage, car finance or any other loan in future.
Your credit rating could also take a hit if your former partner goes on a credit card spending spree and they’re still named on the title deeds of your property.
As far as the credit card company is concerned, someone at your address is racking up excessive debts. This will damage your credit rating – even if the perpetrator no longer lives at the property.
5. You Could Lose Part Of Your Pension
Pensions are very complex. In the past this led to some people treating them as an afterthought because they couldn’t bear to wade through all the paperwork.
But these days – as people live longer – your former partner is much more likely to come after your pension.
And they could grab a slice of it too, even though it’s your pension and that it's linked directly to your job.
Under a defined benefit scheme (sadly much rarer these days), a spouse could receive a 50 per cent pension after the main beneficiary died.
If you divorce, your spouse would lose that potential benefit. So they could demand a share of your pension pot.
6. You Could Get A Big Tax Bill
Capital Gains Tax to be precise.
Here’s the scenario. You have a second property which you let out to provide extra income.
Perhaps it’s your spouse’s old flat from before you married. Maybe you inherited the property when an elderly relative died.
Either way, that property could be sold when you split up. Normally the proceeds of any such sale would be liable to Capital Gains Tax (CGT).
But you may not have to pay CGT if you can resolve it all before the end of the tax year in which you permanently separate.
Even after you have separated, there are certain tax reliefs available to married couples (usually within the tax year of their permanent separation).
Here’s the problem though: divorce can take time – particularly if your former partner is being unreasonable.
And if your divorce drags on into the next tax year (ie, after April 6), then you could be liable for Capital Gains Tax.
Some people try to use this April 6 tax deadline as a lever to speed up a divorce. Don’t let them browbeat you into an unfavourable financial settlement. It is often advisable to seek specialist tax advice early into a separation.
7. Your Car Insurance Premiums Could Rise
You’ve probably seen recent media reports warning that divorcees face having to pay higher car insurance premiums than when they were married.
BBC Radio 4’s Money Box programme (and later BBC TV news) highlighted the case of one woman listener whose annual premium soared from £582 to £919 after she divorced. Her broker claimed it was due to a mistake, a glitch.
But there are plenty of similar news stories dating back over the years.
In August 2000, BBC TV’s Watchdog programme reported a similar case in which a motorist was charged an extra £50 on her premium after divorcing.
Insurers argue that they base their premiums on risk, on the number of claims made.
So don’t expect them to change their minds about premiums anytime soon.
Get Expert Legal Advice
Every divorce is different. Our experienced family law solicitors help families to deal with all kinds of unintended consequences, including those listed above.
For more advice, contact Coles Miller Partner Richard Perrins, Head of our Family Law Department, 01202 355698.