Prepare yourself for divorce financially: Introduction
There is nothing good about divorce yet Canadians continue to engage in the practice in record numbers. The divorce statistics are staggering. According to Statistics Canada:
- In Canada, 48% of marriages end in divorce (Ontario’s rate of divorce is 42.1%)
- The average length of a marriage nationally is 14 years
According to the Vanier Institute of the Family, the divorce rate for second marriages is even higher at over 50%.
Prepare yourself for divorce financially: Not just emotionally
We all know how emotionally gut-wrenching divorce can be on couples and their children. But, how many couples are financially ready for divorce? Unless you’re like Gwyneth Paltrow and Chris Martin (each mega-millionaires in their own right) who “consciously uncoupled” or like the rich and famous with iron-clad prenuptial agreements, do you have any idea of what a divorce can cost?
Prepare yourself for divorce financially: Cost of divorce in Canada
According to the results of Canadian Lawyer’s 2015 Legal Fees Survey:
- $1,353 – the national average cost for an uncontested divorce
- $31,330 – national average cost of a two-day trial
- $56,439 – national average cost of a five-day trial
- $81,958 – the national average cost of a seven-day trial
Prepare yourself for divorce financially: It costs more for two to live separately than together
Now the shock is about to set in… How are you going to manage your finances separately? Do you know what your monthly expenses are? Do you have a budget? If not, you’re going to need one now.
In all likelihood, you aren’t going to be able to maintain your former lifestyle. If you do, you may land up in a situation where you are bleeding money and accumulating mountains of debt. Are you carrying over debt from your marriage and trying to maintain your old lifestyle?
Prepare yourself for divorce financially: What should you do if you have too much debt?
This is a difficult time but burying your head in the sand isn’t the answer. The best option is to deal with debt with the help of a professional trustee. This is especially true in a separation or divorce situation as one of the very few situations that are NOT stopped by an insolvency filing stay of proceedings are family law proceedings.
Many divorce lawyers do not understand the relationship between provincial family law and the federal Bankruptcy and Insolvency Act (Canada). You are best to consult with a licensed insolvency trustee before taking any action. You need to financially prepare for divorce.
Although your particular situation may seem catastrophic, we offer peace of mind that you will get through this and you will be able to start over. Contact Ira Smith Trustee & Receiver Inc. today. Starting Over, Starting Now you can take back control of your life and be debt-free.