Gail Vaz-Oxlade's Guide To:
Do It Yourself Divorce
Financially Smart Divorce
For more than 25 years you have witnessed Gail Vaz-Oxlade's trademark straight-up money wisdom, both on Radio and Television, most notably as host of TVs Till Debt Do Us Part, Princess and Money Moron. Gail is a best-selling Canadian financial author.
Gail Vaz-Oxlade's Guide To
Do It Yourself Divorce
Financially Smart Divorce
Do It Yourself (DIY) Divorce
Home-Made Separation Agreements
OK so let’s be blunt about this… in Ontario you are NOT required by law to retain a lawyer and you are most certainly entitled to sit down and write your own homemade Ontario Do It Yourself Divorce agreements. If you want, you and your spouse can legally write whatever you want on the back of a napkin, each sign it, have it witnessed and call it your Separation Agreement.
But here’s the thing… a separation agreement has NOTHING to do with whether or not it is legal, whether it is a BINDING or whether it is even an ENFORCEABLE agreement. And months from now, when your ex-partner wants to revisit the terms of this agreement, its likely to be thrown out… simply because it wasn’t prepared the right way from the beginning.
And here’s the other thing. If your spouse is willing to let you off the hook with a “You keep yours and Ill keep mine” offer… you don’t walk down to our offices… you run! Because this is what people forget: if its not prepared properly – it won’t stick! And if your spouse is willing to make this easy, you want to make sure this great arrangement sticks, not only today but for years to come.
DIY Divorce: Process is Everything
Yes it is important WHAT goes into your agreement, but HOW it is prepared is just as important. As far as the province is concerned the two of you can agree to just about anything. BUT your Agreement must:
- be inline with existing Ontario laws,
- include full financial disclosure and
- ensures that both parties are aware of all of their rights, responsibilities and obligations before they sign anything.
- Do not sign under any kind of pressure or duress.
This means that should your homemade agreement end up in front of a judge, the judge will review the process under which it was made. They will look to see whether there were proper financial disclosure , whether the agreement was signed under any kind of duress and whether each party received independent legal advice from a lawyer to understand what they were signing. If this didn’t happen, plan that your homemade agreement will go out the door and you are now into the game for the big bucks!
Keep in mind…
Your Separation Agreement is probably THE MOST IMPORTANT legal document that you will ever create and sign. It is going to follow you for years. Not only will it define the terms between you and your ex-spouse for years, not only will it dictate how your children will be raised, not only will it define your financial future moving forward, but it will be required when you apply for a mortgage, transfer house title, file your taxes, take out a loan, set your children up in daycare, and when you apply to be remarried, etc., etc., etc.!
The Unofficial Rules of Divorce:
Divorce gets prickly, even in the most amicable situation
It’s often less about the legalities and more about the money
People make expensive mistakes because they don’t make a plan
Before you do anything, understand your rights, obligations & complexities
Do It Yourself Divorce Doesn't Necessarily Mean Saving Money.
I’m all for saving your dollars…
Save dollars on your groceries. Save your dollars on your heating bill this winter. Heck, shave your head and save a few bucks on hairdos, but when you are drafting a document that is this important…you want it done right!
A LITTLE about legalities… a LOT about finances
Sure, there are legalities involved with your Separation Agreement. Just like good fences make good neighbours, so too do good legal agreements make good Exes. Its true, lawyers lay awake at night wondering if a word is to be a should, a would, a could or a shall. And lets nor undermine this role… that difference in simple legal verbiage, can cost you tens of thousands of dollars later on.
BUT beyond the legal-ese, your Separation Agreement is REALLY about your money – financial planning, debt issues, retirement planning and most importantly tax implications. A wise Separation Agreement takes your post separation financial planning into consideration. Should I pay support monthly or a one-time payment? Will my kids still qualify for OSAP? Do I divide my pension now or later? Do I take the equity from the house or from the RRSP’s? Can I afford to keep the house or should we sell it? How do I deal with residual debt? Can I still retire on schedule?
These are REALLY important questions that will need to be addressed. And unless you are profoundly financially savvy on your own, it pays to bring in some professional advice. This is one of the benefits of having the right team of professionals working to craft your separation agreement. A shrewd team of legal and financial professionals will help you plan for a future where your money is best working for you!
What It Means When Your Spouse Suggests Mediation
- Mediation is typically cheaper than lawyers or the courts
- Mediation tends to be the faster divorce process
- The courts will require you to consider mediation first
- Mediation has an excellent success rate