SA Property Settlement - When Does Saving Stop Going to Joint Assets?

[DadyO]

Hi

I am going through a fairly amicable property settlement.We have agree to a 50/50 split of all assets. But that has little to do with my question.

My question is that the lawyer drawing up the consent orders requested my personal account balance as part of the order. That's fine and this was about 8 weeks ago. Now she is requesting the current balance.

I haven’t received any unusual payments just spending less and saving for the quarterly bills about $4k.

At what point do my saving stop going into the joint pool. I guess the issue is if I save money and they continue to add it to the joint pool, I may as well go on a spending spree if half of my savings go to my ex.

I hope this is clear.

Thanks

 

[Rod]

There is an argument to made for assets to be as of the date of the split, or some other agreed date.

This is best done done before getting into too much detail. Other items may be added or subtracted after this date depending on circumstances.

 

[DadyO]

Can you expand on this? My personal account didn't even exist at the time of the split (I assume you are referring to when we started living separately).

 

[Rod]

Not sure how to expand. If it an amicable split, why look at income post separation? Should find out why the lawyer wants an up-to-date accounting, else just roll with it and give the information being requested.

 

[DadyO]

Thanks Rod.

When you fill the Application for Consent Orders you basically complete two lists, one for each partner. If the aim is for a 50/50 split then the assets on each column should be equal. So for instance one has more superannuation than the other then superannuation will need to be transferred to the lesser party.
What's happening is as I save money and she does not the columns becomes out of balance and the funds need to be transferred from me to re balance the list?

If this drags on for months I loose thousands of dollars. If the balance of my account is set at say 8 weeks ago I can save money and not worry that I'll have to give half away.

Thanks

 

[sammy01]

I disagree with Rod. (kind of) If both parties agree for asset division to be done at separation GREAT. But the law does it from time of settlement, which is basically the day you sign the consent orders for property.

So right now ain't the best time to win lotto because technically the ex would be entitled to some of the winnings....

So your best bet? A few extra cash withdrawals. Nope your best bet is just get it sorted ASAP and don't rock the boat too much getting it sorted is better and cheaper than worrying about having to lose a little bit here or there in the process. At least your getting it done legally. You' be surprised the amount of people who do a hand shake.... Then one person goes on a spending spree and the other saves... Then once the spender has blown their half and goes and sees a solicitor - Well guess what. The only assets left are with the saver, who is about to get their arse kicked (again).....

 

[Rod]

Hmm, consent orders means you are going through the court system. I had thought you were managing this as a DIY or a mediated settlement.

And when going to court, yep, you've got to follow their rules.

 

[sammy01]

Oh dear... I'm gonna disagree again, Rod. (Sorry)

For any property / asset division to be legally binding, it must be stamped by the court and both parties must get independent legal advice. Any DIY or mediated settlement must still be stamped by the court and if it isn't, then you're risking further legal action and more money.

You can come up with a mutually agreeable solution and shake hands on it. You can even sign it, with witnesses if you want, but it will not be legally binding and the scenario I outlined where one person goes on a spending spree while the other saves only to have the spender come back for another bite of the cherry happens and it happens with remarkable frequency. In fact, I reckon it is one of the most common mistake folks make.

I know one case where she spent $150 000 in less than a year, mostly on frivolous junk that depreciates as soon as you buy it. He saved. Then after a year, she filed for a court settlement. The fact that she'd blown $150 000 didn't matter. So he wound up having to hand over half of his $150 000 because that was all that was left at the time of settlement. (Look, it wasn't that simple, but he definitely got his arse kicked twice and all without even stepping inside a court.)

That said Rod - if both parties agree on dividing stuff at the time of break up it at what ever time, then they agree and all good. But if they don't, then it is based as of the time of settlement. In this case, they don't appear to have agreed and why would the other party want to agree when she is looking at getting half of all he saves.

My suggestion - Go to the ATM, make some cash withdrawals. Pull out a few extra couple of hundred every time you go shopping. Or accept that until you get this legally sorted saving money is problematic.

 

[Cairnsdad]

I agree with sammy because that it is better to have an ongoing plan than merely hoping everything stays amicable which can rapidly change especially when money is involved. Personally, I pre-paid as many bills as I could for as much as I could into the future and as sammy suggested, kept my balance low via other methods because I knew my ex was burning through the initial money we agreed to split.

Very easy to defend the fact you have paid 12 months health, life, house, car insurance, etc. in advance instead of by the month for example which would reflect in a lower than expected balance (her expectation). I even pre-paid approximately a year's worth of electricity.

 

[Rod]

Not sure I'm disagreeing.

I am saying stamping by the court is different to following all court rules arriving at a property split. These are two different processes.

See Property and finances after separation - Family Court of Australia