2.1 Financial Orientation


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Most couples manage their finances jointly. The income from both spouses is used to pay for all household and personal expenses. At the end of a relationship, the spouses need to separate their finances. Both spouses need to assess their financial situation and begin to manage money separately.

Lawyer’s Tip:

A major mistake that separating couples make is that they put off dealing with the separation of finances.

This transition can be tough. You may have gotten used to managing a household budget with two incomes or having your spouse deal with the banking accounts. 

The sooner you deal with separating your finances, the easier and less stressful your separation will be.  Key decisions involving money you may face include child support, spousal support, and the division of your property and debt.

You’re going to need to take some action to get a full understanding of your financial situation. You may be wondering where to start.

First, you need to do a financial inventory of your assets and debts. You need to figure what you own and what you owe. For some things, like a home or a car, this may mean that you need to get a market assessment to determine its value.

Next, you will need to separate your accounts. If you have joint bank accounts, credit cards, loans and investments, you should talk to your financial institutions to create separate accounts. Make copies of the value of each of the accounts before and after they are separated.

Finally, you will want to work out your net worth and set up a budget so that you can manage your own finances moving forward.


Financial Inventory

When you separate or divorce, you need to make a complete list of all the things you own jointly or separately (including property, bank accounts, investments, and vehicles). You also need to list your debts (everything you both owe).

Judge’s Tip:

Make copies of important financial information, such as recent pay stubs and tax returns for past three years.

Take specific notes on the names of your financial institutions and account numbers for your chequing and savings accounts, credit cards, loans and investments.  You might not know the exact number value of each item but try your best to estimate what the fair market value (the price it could be sold at today) is.  Make sure to note who owns or owes the asset or debt, whether it’s both of you or just one of you.

The next section provides a Financial Inventory Worksheet. Use it to help you gather and record the information you need to assess your current financial situation.

Once you have a total value of all your assets (what you own), subtract the total amount your debts (called liabilities – what you owe). This will give you the value of your net worth. It is important to know your net worth in order to accurately be able to work out property division.



It is also important to create a household budget. This will help you understand what you can and can’t afford and your current financial picture. A budget is simply a monthly record of how much money you have coming in and going out. It’s important to keep track of your money so you can better manage the care of your children and the care of yourself.

Making good financial decisions start with knowing your financial situation.  Making a budget is a great way to reduce the stress that managing your personal finances can cause.  Fill in the Budget Worksheet to help you manage your finances during your separation.


Who Can Help?

There are a number of professionals that can assist you in dealing with your finances. Consult a financial planner or advisor, or an accountant. They can help you understand the financial and tax implications related to your separation or divorce.


What’s Next

Getting your personal finances in order will help you manage your separation or divorce with more ease. When you don’t have to worry about your finances you can focus on the important issues you need to resolve. These issues include decisions about how you will care for your children, child support, spousal support, and dividing your property.  To make good decisions you’ll want to know your rights and responsibilities for each of these issues.  Before you start learning about your legal rights and responsibilities, take a moment to go through the Financial Separation Checklist