Let’s face it, divorce is not pretty. The breakdown of a relationship is generally full of emotion, uncertainty and anxiety. Then at our most vulnerable we have to negate property settlements, child custody and support.
After concentrating on being the primary care giver for the kids and working 30 hours per week, Danielle* had become detached from the everyday finances in her marriage.
In late 2012, Danielle and her ex-husband had agreed to a settlement. A trusted friend referred Danielle to get some financial planning advice and review her new circumstances.
Danielle aged 44 has two children ages 15 & 11 both in private school. She is working 30 hours per week in payroll administration earning an annual income of 36,000p.a. Their living expenses are estimated to be $57,000 p.a.
Danielle outlined her most important goals:
- To be there for the children before and after school;
- To be independent financially with an annual income of $60,000;
- Gain control of her finances;
- Protect her assets for her bloodline.
In the settlement document, Danielle was to receive full ownership of the family home valued at $500,000 with a $90,000 mortgage; superannuation entitlements of $250,000 through a super split; and a cash component of $350,000. She also is to receive $10,000 p.a. child support payments.
Danielle sought the guidance of Alman Partners and after analysing her financial position, understanding her goals and personal values, Alman Partners drafted a financial roadmap for Danielle. Below are just a few of its features:
- Recommended $90,000 mortgage be paid out immediately;
- $220,000 was placed into a Moderately Conservative Investment Portfolio;
- $40,000 funds retained in cash to assist with income shortfall and emergencies;
- Superannuation invested in a suitable Balanced Asset Allocation;
- Binding death benefit nominations established in the Super fund with each child nominated 50%;
- Referred to Centrellnk and receiving family tax benefit A and B;
- Will established with Testamentary Trust provisions for each child;
- Death and Total and Permanent Insurance established to provide for the children.
Over the past two years Danielle has gained a sense of stability and clarity. She has been able to achieve her goals and aspirations while at the same time knowing that her family’s financial future is safe.
*Names have been changed to protect the individual’s identity.