Starting Over, Successfully

Change in financial circumstances – divorce
Financial Health for Teachers
Starting Over, Successfully
Ten years ago, when my sister gave birth to twin boys
(my first and only nephews, and my parents’ first and
only grandchildren – so far), it changed our family life
for the better. We now had two little popstars to focus
all our love and attention on.
Ten years later, when my sister tearfully announced that
her husband had walked out on her, our feelings were
the opposite – but it had a similarly life-changing effect.
From a professional point of view, I’d helped hundreds
of people through relationship breakdowns, but this
one was going to be personal.
That’s not easy for anyone. Where do you begin when
you’ve been a team for years?
Having to control your financial life (earning money,
spending it and saving it) – especially if you have kids,
and even if you don’t – can be hard on your own.
Yet my experience of helping thousands of people has
proved to me that getting your finances sorted can be
incredibly empowering. If you follow some simple steps,
you’ll enjoy a couple of big wins at a time when not
much else seems to be going right.
As you’ll see in this month’s case study, my sister, SueEllen, lives in central Victoria with a mortgage, her two
midgets and no money to waste. She’s a passionate
teacher, but her position is currently part time – rather
than the security of full time. All these factors combined
to make her feel overwhelmed and, initially at least,
stopped her from moving forward.
And she’s not alone. When any relationship breaks
down – and I’m talking about men just as much as
women – there are three reactions people usually have:
1.
“We were struggling when there were two incomes
– now there’s only one. What am I going to do?”
2.
“Where am I going to live? Am I going to be kicked
out of my family home? On a single wage with a
mortgage, how can I maintain the stability of the
family home?”
3.
“Separation happens to other people, not me.
What’s going to happen to the kids?”
Starting over
My sister had to face these questions. More than
that – after years of hard work, years of having a
mortgage, years of being a wife, she sat down on the
couch by herself one night and realised she now had
to start over.
November 2012
Focus on Your Future
Without getting too ‘Dr Phil’ on you, when a
relationship breaks down it can have a paralysing effect.
It’s hard to move forward when your head and your
heart are stuck in the past, thinking about things that in
most cases can’t be changed.
That’s why it’s really important – from the outset – to
make a firm commitment that you’ll do everything
possible so that you can be the best ‘you’ ten years
from now.
www.teaching.moneysmart.gov.au
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Change in financial circumstances – divorce
With that in mind, let’s dive straight in and talk about
the two elephants in the room that will have a major
and immediate impact on your finances.
What will I do about my family home?
Many people, with the best of intentions, choose to stay
in the family home so as to provide some much-needed
stability for their children. That was certainly my sister’s
biggest concern.
But let me be blunt: if you can’t afford it, you’ll find
yourself not only in emotional stress but financial stress
as well. You need to be kind to yourself – and your kids
– and that means living in a place you can comfortably
afford.
How will I adjust to living on less income?
You’re going to have to juggle higher living expenses
and shared parenting. Yes, you’ll have a financial
settlement (or a court will decide), but the fact is that
both partners will be worse off financially.
Again, at the risk of sounding like some New Age guru,
money is in some ways like energy. Your emotional
energy has been drained, and now you’re facing the
prospect of working harder and perhaps longer to cover
rising costs.
The challenges I’ve designed will go a long way to lifting
your financial worries and will give you a little more
energy to focus on the most important parts of your life:
yourself, your children and your students.
The 60, 60, 6 Challenge
As a teacher, there’s never enough time!
Teaching kids can be very draining, especially at a time
when you’re already running on emotional credit. So
the important thing to do is to take small steps. Setting
yourself these little tasks is a step forward to your new
life. Then you’ll no longer be in limbo. You’ll be on your
way to a better place.
So, when you’re sitting on the couch watching Modern
Family, when you’re in the car coming home from work,
or when you’ve got a bit of time spare on the weekend,
take some time to do these challenges. Do them in baby
steps – an hour here and an hour there – and I’ll show
you a map you can follow to get back on the road to
financial peace.
60 Second Challenge
Write It Down
This challenge is so simple it sounds dumb, but it’s
actually important and empowering. All I want you to
do is get out a pen and a piece of paper and write down
the date of your separation.
Why?
Well, it’s important for a couple of reasons. First, you
must have been separated for at least 12 months before
you can apply for a divorce and, second, it acts as a
mental yardstick for your progress.
60 Minute Challenge
Do Some Financial Housekeeping
I’ll be honest: there are a few tasks here, and each one
may take up to 60 minutes. So think of them as a set of
challenges you can tackle when you’re doing something
else (watching TV, going for a walk, on your lunchbreak).
Make a list and check them off – it can be good to
channel your energy!
Get Your Own Money in Your Own Name
Contact your bank immediately and make sure your pay
is going into an account in your own name that your
partner can’t access.
Make a note of all your joint accounts – you’ll need this
information when you consult your solicitor in the next
challenge. Actually, if you have any credit cards in joint
names, cancel them immediately.
www.teaching.moneysmart.gov.au
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Change in financial circumstances – divorce
Gather up Your Bills
You may or may not have been the bill-payer in the
house when you were together. Well, you are now! So
gather all your bills together, print them out and put
them into a manila folder. With a highlighter, circle the
following: when they’re due, how much is owed, and
whose name they’re in. (Remember: you’re on the hook
if your name’s on the bill.)
Don’t forget your biggest bill – your rental lease (if
you’re renting). This is something you’ll need to access
and take to your solicitor because, if your partner is still
living in the rental property, you could be liable for any
damage they cause or rent owed.
Do a Budget
When you’re feeling bad, it’s easy to spend emotionally
on ‘sugar hits’ that will make you feel better – for a
moment. But that can be dangerous now that your
income is significantly reduced.
To get some control, go to the ASIC MoneySmart
Budget Planner and set out a budget. It takes about 20
minutes, and it’ll show you:
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where your money is going
XX
if you’re spending more than you can afford
XX
whether your money is going towards your priorities.
Of those who divorce:
XX
50% sort matters out between themselves with
the help of lawyers, mediation and counselling
out of court
XX
45% make court applications, though most do not
go to trial
XX
5% (of court applications) go to trial.
Source: Relationships Australia
Write It Down
Get out a piece of paper and write a list of everything
you own and everything you owe. Doing this gives you
a sense of control. Make sure you keep the paper handy,
because over the coming weeks your subconscious will
remind you of things to add to the list.
Gather Together Your Super and Insurance
Now more than ever you’re reliant on your income.
So it’s important to make sure you have adequate
insurance – not just on your car and home but also on
your most valuable asset: your ability to earn an income.
Income protection insurance, as it’s called, is often
available as part of your super, along with total and
permanent disability (TPD) and life cover – though it
may not be enough.
But for now all I want you to do is ring all your insurance
providers and print off a copy of each policy. Then call
your super fund (you may have more than one) and
have them send your statement, which should include
your insurance coverage. Put it all into another manila
folder – this is information you’ll take to a financial
professional in the next challenge.
Review Your Will
Find your latest will, if you have one, and, if you don’t,
get one immediately! Keeping it up to date is also
critical. You may want to change your beneficiaries –
assuming you don’t want your ex-partner to inherit all
your wealth.
www.teaching.moneysmart.gov.au
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Change in financial circumstances – divorce
6 Day Challenge
Get Some Help
If you’re going through a relationship breakdown,
hopefully you’ll have supportive family and friends
around you. But you’ll need more: there are
professionals you should reach out to for financial help.
Talk to a Lawyer
One of the most important things to do is to get proper
legal advice on the process of separation. So, make sure
you choose a lawyer who’s experienced in family law.
It’s important to understand that legal advice doesn’t
mean you have to go to court.
Your lawyer will be able to:
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explain what to do about your jointly held money
(see also the 60 Minute Challenge on this)
XX
talk you through the separation of any property you
hold jointly (e.g. you can place a caveat on a title if it’s
held in your partner’s name)
XX
discuss preliminary childcare arrangements with you.
Your finances are one area of life that, in a very stressful
time, you can take control of. And – as anyone knows
who’s been through an intense breakdown (and that’s
most of us) – every little win counts.
What to bring to all your 6 Day
Challenge meetings:
XX
All the financial information you’ve gathered from
the 60 Minute Challenge.
XX
A friend – at least to your first consultation –
as much for moral support as their note-taking
ability.
XX
All the confidence you can muster. If you don’t
understand anything, ask plenty of questions –
remember, they’re working for you.
Legal advice can be expensive, but doesn’t have to
be. You can start with free advice or a referral from a
community legal centre (www.naclc.org.au) or a state
Legal Aid office.
Talk to a Financial Counsellor
Another professional you need to talk to – if you’ve
been left with significant debts or if you’re simply
overwhelmed by your finances – is a community-based
financial counsellor. They’ll help you set up a basic
budget and will talk you through some emergency
options to get you through this stressful period.
Financial counsellors offer a free service: call
1800 007 007.
Talk to a Financial Information Service Officer
The third professional you should talk to is a
(government-funded) Centrelink Financial Information
Service Officer (FISO). These people are a wonderful
source of information – they’ll make sure you’re
claiming any entitlements you may now be eligible for.
Contact them on 132 468.
www.teaching.moneysmart.gov.au
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Change in financial circumstances – divorce
Case Study
Surviving Divorce: The Single
Mum’s Story
Sue-Ellen Pape, Year 11 & 12 Teacher, BTEC, Victoria
Sue-Ellen Pape found that it was teaching disengaged
young people that got her through the toughest time of
her life – her separation.
She originally thought she’d move into primary
teaching, and that’s what she retrained in after years of
doing adult education. But once she’d qualified, a parttime opportunity came up teaching students aged 16 to
18 at a technical college. She took it.
“It was the best thing I ever did, teaching those
disengaged kids”, she says. “A lot of them had been told
by their parents or other schools that they were dumb,
not academic, so there were a lot of self-esteem issues,
as well as drug and alcohol use, teenage pregnancy,
depression, suicide – lots of issues.”
Sue-Ellen made an effort to build rapport with these
young people, and it took time to gain their trust.
“I connected with them. I felt like I helped them,
but in fact they helped me through a really difficult
time as well.”
She and her husband separated at the end of 2011
and she continued to teach. “It was personally a really
difficult time, but I actually used it as a positive. It gave
me insight into the students, because I would say 70%
of them have parents who are separated.”
But, being a mother of 10-year-old twin boys, it was her
own children that were concerning her most. “It was
really, really important for me that they stayed in their
only family home – the only home they’d known – so I
was determined to make that happen.”
The trouble was it meant getting a mortgage to cover
what she’d previously shared with her husband. And,
working only part time on contract, she wasn’t sure the
bank would come through.
“I knew the mother lioness in me
had achieved that goal of keeping
my children secure in their home”
“In the lead-up to it”, says Sue-Ellen, “I had lots of emails
backwards and forwards with a very supportive woman
at the bank. Then she emailed me to say it was all
approved, which was a really proud moment for me. I
knew the mother lioness in me had achieved that goal
of keeping my children secure in their home.”
Since then, she’s not only kept the house, she’s paying it
off comfortably on her wage. What’s more, she’s had the
satisfaction of keeping her children in their home for
the first 12 months after the separation, allowing all of
them to get settled.
Sue-Ellen believes it’s the little money decisions she’s
made (as well as the big ones like sorting the mortgage)
that have made the difference for her and her boys.
“We do things like spend time together, walk the dogs
together, have family movie nights where we hire a
DVD and eat popcorn in our pyjamas – just little things,
rather than trying to compensate by being a Disneyland
parent.”
It’s also about having a budget and knowing what’s
coming up. “Whenever I get extra money, I’ll pay a
hundred dollars extra off the gas bill, knowing the
winter gas bill’s the biggest one – things like that.”
Life continues to be a challenge for Sue-Ellen, but
with her finances mostly under control she’s looking
ahead with hope. “Next year will be a year of travel
and celebrating life and moving forward and new
beginnings with family and friends.”
And to keep working in a job she loves. “Be organised,
be kind to yourself and use the support of your
colleagues”, she says. “Be honest, get support, and love
what you do.”
www.teaching.moneysmart.gov.au
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Change in financial circumstances – divorce
Principal Update
The Singleton Experience
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Teachers have been professionally developed and
provided with a real-life context for their teaching.
XX
Parents have been exposed to workshops
facilitated by a skilled presenter.
XX
Students have been engaging in conversation and
discussion about money management.
Across the school, students have demonstrated a
positive response in their learning as a result of their
involvement.
Principal Bevan Ripp with teacher Sheila Griffin
Singleton Primary School is an Independent Public
School 45 minutes south of the Perth CBD. It has 780
students from Kindergarten to Year 7, a teaching staff
of 44 and a support staff of 25.
Singleton’s opportunity to become a MoneySmart
school came as a result of the work of our Numeracy
Specialist Teacher, Sheila Griffin. Her skills were
recognised by WA’s National Partnerships team and
she was invited to lead the implementation of the
program in WA. From there it was easy to get the rest
of the staff on board.
Some three months into the program and
feedback from all staff has been extremely positive.
MoneySmart doesn’t require any extra work for
teachers (because it’s integrated into the curriculum),
and it provides a useful context for teaching skills and
concepts that already exist in syllabus and curriculum
materials.
The experience has had a profound effect on our
school community. Teachers, parents and students
alike have gained immensely from being involved:
Upper primary students have developed a common
currency that’s used for dealing with every aspect
of their classroom life, from direct transactions and
workspace rental to fundraising and donations.
Middle primary students use transaction books to
gain a greater understanding of credit and debit.
The best story so far, however, belongs to a Year 1
student who normally struggles with numeracy. His
engagement has motivated him to develop his own
fundraising strategy in which he gets fruit donated so
he can sell it at a kerbside stall. He’s run three so far,
and all proceeds go back to the school for Mrs Griffin
to purchase more resources to support MoneySmart
Teaching.
Moving into the next 6 to 10 months, Singleton’s
intention is to trial the materials again, to refine
the implementation process, and to provide more
relevant feedback to ASIC.
We are confident that, by the end of the period, we’ll
be able to embed financial literacy into a wholeschool numeracy plan, and that teachers will feel
confident and well equipped to deliver the required
learning.
Bevan Ripp
www.teaching.moneysmart.gov.au
ASIC Infoline: 1300 300 630
© Australian Securities & Investments Commission 2012.
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