How Separation and Divorce in Alberta Affect Your Finances
For the most part, legal separation occurs before two people get a divorce in Edmonton, Alberta. A 12-month period of separation serves as grounds for a divorce in the province. During this interim period, you and your spouse should execute a written separation agreement. An Edmonton divorce lawyer can guide you through the numerous issues that you should address in this contract. It outlines financial and parenting decisions necessary for the separation of your lives and households. The separation agreement typically creates a roadmap for how you will eventually settle the divorce.
What’s the Difference Between Legal Separation and Divorce?
A legal separation does not dissolve your marriage. You still remain legally married, and therefore unable to marry another person. The separation indicates that both of you have ended the day-to-day marital relationship but have yet to proceed with a formal divorce.
You do not need to go to court to initiate a separation, but you may have many reasons to consult an Alberta divorce lawyer when preparing the separation agreement.
A divorce, on the other hand, must involve a court. Only the Court of the King’s Bench of Alberta can formally end your legal status as a married person by finalizing the divorce.
Because you must be separated for at least 12 months before the court can grant the divorce, the waiting period is your chance to work out the financial details. Some people extend their separation due to financial or other practical considerations.
Separation Agreement Vs. Divorce
Unlike a divorce, a separation agreement does not have to be the final word on finances and child custody. Whether you perceive your split as a trial separation with the hope of reconciliation or you expect to proceed with a divorce, you and your spouse need to establish individual budgets. Using a written separation agreement gives both of you a framework for coordinating living expenses and parenting duties.
When disputes arise, you can refer to the terms that you agreed to previously and move forward. You have the option of altering the terms of the separation agreement as long as both of you consent to the change.
This document may explain:
- Who pays which bills and debts
- How to manage individual and shared bank accounts
- Who will continue living in the marital home
- Child custody schedule
- Division of personal possessions or real estate
- Child or spousal support payments
- Who remains on insurance policies
- Tax filing responsibilities
A divorce differs from the separation in that it forces the division of marital property. Although you can start dividing assets during your separation, you do not have to do it. The divorce also dissolves your legally married status and removes certain spousal rights in financial matters.
Financial Advantages of Separation
Separation normally involves setting up two different households, which means both of you will have individual living expenses. Your separation agreement represents your plan for transitioning to a single-income lifestyle.
Beyond day-to-day expenses, your separation could delay other financial consequences of a divorce.
During separation, you have the option of retaining a spouse on insurance policies because you are still legally married. This is sometimes an important financial issue if one person would lose important coverage in a divorce.
Pension benefits are another consideration. You may want to retain your married status in order to continue accruing future benefits as a spouse.
In fact, some people prolong their separation because they do not want to liquidate and/or divide assets. People who own multiple properties or a business may see these assets as reasons to choose separation over divorce. They need more than 12 months to prepare for the final division.
Do not assume that you know your rights to different assets. Consulting with a divorce lawyer in Edmonton is the best way to find out how the law will apply to your precise circumstances.
Do I Need a Lawyer to Separate From My Spouse in Alberta?
You could start your separation without a divorce lawyer in Edmonton, but you would likely benefit from legal advice during the process. Once both of you sign the separation agreement, it becomes a legal contract. Should a dispute about its terms arise, a judge will consider its terms binding.
As a result, your separation will require you to make decisions that have a lasting effect. To protect your future best interests, ask an Alberta divorce lawyer for advice.
If you and your former spouse plan to divide property within your separation agreement, then you do need an Edmonton divorce lawyer. According to the Alberta Family Law Act, both people must have independent legal advice before signing a separation agreement that alters property ownership. They cannot consult the same lawyer. Without proof of independent legal representation, the agreement becomes unenforceable.
How Alberta Divides Assets in a Divorce
The Matrimonial Property Act guides the division of property during a divorce in Alberta. The law calls for an equitable and fair division.
Matrimonial property includes:
- Real estate
- Personal property and vehicles
- Bank and investment accounts
- Pension benefits
- Life insurance
- Debts
Matrimonial property is defined as the assets and debts acquired from the date of marriage until your separation. Although the definition sounds clear, in reality the status of assets can get murky and is often a source of dispute. An Edmonton family lawyer can provide valuable advice that helps you understand your options.
Know Your Rights About Separation and Divorce in Alberta
Ending your marriage is not easy. You must navigate strong emotions. You may need to stand up for your rights to protect your financial future.
Kolinsky Law will empower you to make fully informed decisions during this major transition in your life. Learn how an Edmonton divorce lawyer can defend your best interests. Call (780) 757-6400 or email us today.
