Seven money moves make immediately after you separate or divorce

A relationship breakdown can be emotionally devastating, but it can also bring a range of financial challenges that need to be addressed.

Although divorce or civil partnership dissolution may take months or even years to complete, the financial impact of separation often starts straight away.

Taking action early to organise your finances, protect your money, and understand your options can help provide greater stability while longer-term arrangements are being agreed.

Here are seven things you should do as soon as possible.

Open a bank account in your sole name

Many couples manage their finances through joint accounts. This can work well during a relationship – but it can make things more complicated if you split up.

Vix Leyton, consumer expert at thinkmoney, says: “One of the first things I’d do is make sure you have a bank account in your sole name. Not because you’re declaring war, but because you need a safe, clear place for your own money to go.

“If your salary or benefits have previously been paid into a joint account, now is the time to redirect them.

“It gives you access to your own income, helps create a clear distinction between your finances and your ex’s, and gives you somewhere to manage your day-to-day spending without everything being emotionally and financially tangled together.”

You can open a standard current account in minutes online with many providers.

Manage joint accounts

Joint current accounts are often a source of conflict after a separation, particularly if communication has broken down. With most joint accounts, either person can withdraw money, run up an overdraft or cancel direct debits – and both of you remain liable.

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“Speak to your bank as soon as you can and ask what your options are. Depending on the account, that might mean freezing it, changing the mandate so both of you have to sign for transactions, or agreeing how it will be closed or separated,” says Leyton.

“This is not about assuming the worst of your ex. It is about protecting both of you from a moment of impulsive spending, panic spending, or a misunderstanding that turns into a financial mess you are jointly responsible for.”

If you have what you consider to be a “joint” credit card, it will actually be in the name of one person, with a secondary card for the other person.

If it’s in your name, make sure you freeze the second card or you will be liable for all your ex’s spending.

Gather key financial paperwork

When you’re still living under the same roof, or in the chaotic days of moving out, paperwork can go missing. Sometimes accidentally – sometimes not.

Gather everything you can find: bank statements, mortgage documents, tenancy agreements, payslips, P60s, tax returns, pension statements, insurance policies, utility bills, loan agreements and credit card statements.

Take photos or scans and store them somewhere safe – ideally, backed up digitally.

“The more information you have about your financial situation, the better you can understand your overall position,” says Sarah Coles, head of personal finance at AJ Bell, “It’s a good idea to get hold of this as soon as possible, because this information can be more difficult to access if you have joint accounts and your ex-partner closes them or changes passwords.”

Notify lenders and service providers

Once you’ve separated, you need to start untangling the web of shared financial responsibilities.

Start by contacting your mortgage lender or landlord to explain the situation and discuss any implications for future payments. If you’re both named on the mortgage or tenancy, you’re both still liable for payments, even if one of you moves out.

Utility providers, broadband companies, and insurers will also need updating, or the name on the account changing.

Separation can also mean dealing with the practicalities of a “digital divorce”. This means reviewing shared subscriptions and logins, payment details and online accounts to make sure they reflect your new circumstances.

Draw up an emergency budget

This is important – you need to know what you’re working with right away, especially if your living circumstances change.

Start by working out your essential monthly costs, such as housing, bills, food, transport, childcare, insurance and debt repayments.

Then list your income, savings, and any available support, while accounting for one-off costs such as moving expenses, legal fees, or setting up a new home.

“People often fall into debt during a divorce because they are dividing the income that used to run one household into two – and paying for the divorce process on top. So, it’s a good idea to work out the best ways to cut any costs you possibly can in the short term, so you can keep the financial fallout to a minimum,” says Coles.

Review your will and pensions

If you don’t update your will after separation, your former partner could still inherit certain assets if you die, meaning your wishes may not be reflected.

Reviewing and updating your will can help ensure your money and possessions are passed on to the people you intend.

Remember that changing your will does not automatically update other financial arrangements. You’ll need to review your pension beneficiaries separately, as an ex-partner who remains listed could still receive your pension benefits. The same applies to life insurance policies and death-in-service benefits.

Get professional advice early

Even if you’re keeping things amicable, getting independent advice is important.

A solicitor can explain your rights around property, pensions, maintenance, and child arrangements, while a financial adviser can help you understand the impact of dividing assets.

Organisations such as MoneyHelper and Citizens Advice can offer support with budgeting and benefits.

By taking these steps – and by seeking the right advice and support – you can move forward financially with greater confidence.

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