The Importance of a Financial Advisor in Divorce: Making Informed Decisions

In this article, we’re looking at the importance of a financial advisor in divorce to help you make informed decisions which could significantly affect your future and that of your children. 

For couples, a marriage is not just a meeting of minds but also a merging of finances and, in the event of a divorce, a lot of people find themselves out of pocket and it can be difficult to consider the best choices to make financially in such a rocky period of your life. 

Even in 2023, many people going through a divorce believe that their divorce settlement solicitors in Brighton will handle all of the financial aspects of their divorce but this can often be a mistake. In this article, we’re sharing advice on the importance of a financial advisor in divorce to help you to make more informed decisions.  

What Can a Financial Advisor Help With?

As the name suggests, a financial advisor is a professional who is tasked with helping you to make sense of your current finances as well as assisting in planning for your financial future. UK residents may hire the services of a financial advisor in a number of scenarios including the receipt of an inheritance, the seeking of investment opportunities and, of course, a divorce settlement. 

Reasons to Hire a Financial Advisor During a Divorce

There are a number of very good reasons for hiring a financial advisor during your divorce, including: 

Securing a Fair Settlement

In the initial stages of your divorce, your financial advisor will be part accountant, part financial detective. They will examine the state of your finances as well as that of your spouse to ensure that all wealth has been reported and is on record. 

This can be extremely important as, in some instances, a spouse may attempt to ‘hide’ assets from their partner in the event of a divorce to avoid sharing. Your financial advisor will then paint a picture of the whole financial situation and will use this to calculate a fair settlement for you. 

Taking Care of the Bigger Picture 

While, during your divorce, your focus is likely to be on the marital home and any cash assets and investments, your financial advisor will have the experience and expertise to look at the bigger picture. 

This includes looking at any and all pensions as well as business interests to ensure that you’re getting what you deserve out of the divorce. 

Assistance With Negotiating Up-Front Payments 

When you’re still in the eye of the storm in terms of your divorce, it can be easy to panic about where you’re going to live and how you’re going to be able to meet your day to day expenses.

A financial advisor will be able to help you here by analysing your shared assets and, in some cases, negotiating an up-front payment which will allow you to keep the wheels turning until the divorce has been settled and all assets distributed. 

Helping You Plan for the Future 

As your financial advisor will have access to your financial information, including the expected settlement from your divorce, they will be in a position to help you to plan for your future. 

This can include creating plans and budgets, advising on investments and warning you of any pitfalls which you may experience along the way. This is extremely important as, depending on the circumstances of your divorce, it may mean that you will have to make some life changes. This could include getting a job, or looking at other methods of income in order to meet your day to day financial responsibilities. 

Help With Optimising Cash and Minimising Tax 

Even if you consider yourself to be fairly savvy when it comes to finances, a financial advisor is likely to be privy to some tricks and loopholes which you may not be aware of. 

For example, they may be able to advise you on ways in which you can optimise your cash and minimise tax payments by taking advantage of government-approved schemes and investment plans such as ISAs. 


Using a financial advisor during your divorce…

A divorce can be an expensive business, because of this, many people find themselves reluctant to sign up for any additional expenses. A financial advisor in the UK will generally charge between £75 and £150 per hour for their services. While this is of course a fair chunk of change, rather than balking at the cost, try to look at it as an investment. 

Although this upfront cost may be difficult to swallow, it could potentially save you thousands of pounds further down the road. If you’re looking to hire a financial advisor for your divorce, be sure to shop around to make sure that you’re getting the best deal and the most qualified professional for your needs. 

Ask friends and family for recommendations or, failing that, always read the reviews for individuals and agencies to make sure that the person you choose is reliable, trustworthy and provides good value for your money. A reputable financial advisor will usually offer a first meeting or call free of charge so it’s a good idea to steer clear of any who do not provide this. 

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