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The break-up: regaining financial stability after divorce is a priority
- TD Canada Trust offers advice to the newly single for laying the groundwork to long-term financial success -
-TD Canada Trust infographic on how to regain financial independence after a break up at: www.smrmediaroom.ca/TDFinancialIndependence.html -
TORONTO, Sept. 18, 2012 /CNW/ - If there is one constant in the entertainment gossip pages, it is celebrity divorces. While celebrity couples may appear to take this in stride, they are not immune to the financial blow felt by most couples going through a divorce. Recent research from TD Canada Trust suggests many Canadians may not be financially prepared for a break-up, but there are steps women and men can take to regain their financial footing as soon as possible after divorce.
According to research conducted for TD Canada Trust, the majority of Canadians in serious relationships have shared assets. Of those Canadians currently in, or recently in, a relationship, 72% own a home together, 68% have a joint bank account, 64% have a joint financial plan and 52% have a joint credit card. And, divorce proceedings are taking longer, with 21% lasting more than two years, an increase of 6% in the past 5 years1.
"Most Canadian couples are financially interdependent, and it is a real challenge trying to navigate the financial aftermath at the end of a relationship. Many people just aren't prepared for the costs associated with divorce and how their lifestyles may change afterwards," says John Tracy, Senior Vice President, TD Canada Trust. "It's important for newly single Canadians to stabilize their financial situation after a break-up so that they don't start taking on debt, and there are simple steps people can take to re-establish their financial independence at any stage in life."
John Tracy offers advice to newly single Canadians on how to regain financial stability:
Get started: The first step in establishing your financial plan is to understand your current position. You and your partner may have joint assets and liabilities. You'll need to work out the division of the assets and find out what liabilities you'll be responsible for. Work with an expert to understand the implications of dividing your assets and get an accurate and thorough understanding of your financial position.
Speak with a financial advisor: If your partner was the one who was making most money-related decisions, it's time to take the reins on money management. Even if you've always been in charge of finances in your household, it's important to reevaluate your goals and financial situation, and adjust your investments accordingly. Now is the time to reconsider your priorities and goals and what your retirement looks like. A financial advisor can help you navigate your way through these questions and help you create a financial plan. A plan is essential to organizing your financial resources so you can achieve your short-and long-term goals. Even if you and your former spouse shared a common financial advisor prior to the separation or divorce, your financial advisor should respect your privacy as you work together on your future financial plans.
Focus on building wealth: Becoming financially independent means it is solely your responsibility to accumulate wealth for the future. Moving from a saving to an investing mindset is an effective strategy to help build your wealth over time - and it doesn't need to be daunting. Look for investment options that offer a low minimum investment. Everyone has a different risk profile, though, so make sure you have the right mix for you. And, speak to your bank about setting up a pre-authorized transfer that automatically transfers a set amount at regular intervals throughout the year into your RSP. In addition to saving without having to think about it, regular contributions also let you benefit from dollar-cost averaging, which can help build your wealth faster.
Start today and continue to track your progress: Once you have your plan in place, it's time to move forward with your finances. Create a budget, stick to it and track your progress - being disciplined with your budget today will pay off in the future. It's important to review your financial plan regularly to ensure it continues to evolve as your needs and lifestyle change. It's not unusual to have an event that causes a detour in your plan, but a good advisor will be there to help you make sound choices to ensure your goals remain on track. And if you're not sure how to balance competing savings, investing and debt priorities, try out the available online budgeting tools or visit your local branch and talk to an advisor.
About the TD Canada Trust Poll
TD Bank Group commissioned Environics Research Group to conduct a telephone omnibus survey of 2,000 Canadians 18 years of age or older, with 1,379 who are currently or were recently in a serious relationship. Results were collected between January 5 - 15, 2012.
About TD Canada Trust
TD Canada Trust offers personal and business banking to more than 11.5 million customers. We provide a wide range of products and services from chequing and savings accounts, to credit cards, mortgages and business banking, to credit protection and travel medical insurance, as well as advice on managing everyday finances. TD Canada Trust makes banking comfortable with award-winning service and convenience through 24/7 mobile, internet, telephone and ATM banking, as well as in over 1,100 branches, with convenient hours to serve customers better. For more information, please visit: www.tdcanadatrust.com. TD Canada Trust is the Canadian retail bank of TD Bank Group, the sixth largest bank in North America.
SOURCE: TD Bank Group
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