The Benefits of Getting Divorced: Protecting Your Future
Many people delay or avoid finalising their divorce, but remaining legally married can have serious legal and financial consequences which may be against your wishes.
Financial consequences
While you are still married, your spouse is legally considered your next of kin.
This means that if you were to pass away without a valid Will (known as dying intestate), your spouse would likely be:
- the first person notified of your death;
- the one responsible for handling your funeral; and
- the person assigned to manage your estate.
Depending on the circumstances, your spouse may also be entitled to receive your entire estate.
Alternatively, if you have a valid Will which has not been updated following separation and your spouse is elected as a beneficiary, then your spouse would receive a portion, if not all your estate (depending on how the Will was prepared).
In our experience, this is usually contrary to our clients wishes, particularly if the assets have already been divided through a property settlement.
If you have superannuation and/or life insurance policies and you haven’t updated your Binding Death Nominee (BDN) or beneficiaries since your separation, these benefits may also go to your spouse.
As such, it is also important to update your succession plan following a separation.
If you were to die in an unforeseeable accident (such as a motor vehicle accident) and compensation was payable because of your death, your spouse may be legally entitled to that compensation, regardless of your separation.
Non-financial consequences
There are also important non-financial risks. For example, if you were deemed mentally incapable of making decisions and you didn’t have a valid Advance Care Directive in place, your spouse would likely be contacted to make critical medical decisions on your behalf, despite your separation.
Finalising your divorce legally dissolves your marriage and stops these presumptions from continuing.
Time limits for property settlement
Importantly, once your divorce is finalised, a 12-month time limit begins for either party to apply to the Federal Circuit and Family Court of Australia (“the Court”) for property settlement – if this hasn’t already been done in a legally binding manner.
After that window closes, any application is considered ‘out of time’ and will only proceed if the Court grants permission. An ‘out of time’ application only happens in certain circumstances and is entirely at the Court’s discretion.
Finalising your Divorce can therefore offer peace of mind and certainty moving forward, especially if there is no formal property settlement in place.
However, we recommend that you seek advice about whether you pursue a property settlement or a Divorce Order first, so you don’t unintentionally start the clock on a legal deadline that could limit your options.
The Divorce Process
You can apply for divorce either jointly (if both parties agree) or solely (on your own). To be eligible, two main conditions must be met:
- The marriage has irretrievably broken down, with no chance of reconciliation; and
- You and your spouse have been separated for at least 12 months.
If you file a sole application, the other party must be personally served with the Application for Divorce and sign an Acknowledgement of Service (Divorce) for the Court.
Need help?
If you would like assistance with your Application for Divorce or have questions about how the process works, please don’t hesitate to contact us. Senior Associates Scarlett Grose and Deanna are here to guide you through the process.
Get in touch on (08) 8212 1077 or
send us an email: sgrose@tgb.com.au or dgatto@tgb.com.au.