Money9 Edit | Prepare for a divorce fund, hope you don’t have to use it

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Getting trapped at the wrong end of an expensive divorce settlement is one of the ironies of life very few of us apprehend and even fewer plan for. The news of Bill and Melinda Gates announcing their separation sent shockwaves across the world this week. Perhaps most of us were not prepared for the apparently perfect chemistry between the couple to go awry 27 years after marriage. Somehow, the news has triggered discussion among many sections about the need for a divorce fund for any tragic eventuality.

All of us want marriages to endure but most relations perhaps depend more on the chemistry between couples than tangible and quantifiable factors that are more under human control. As stress levels rise in the modern world and relations have to constantly bear its burden, it only appears prudent that one should prepare a fund for the financial settlement of irretrievably ruined relations. The UN has estimated that domestic violence increased by 20% during the lockdown in different countries.

It perhaps needs a dash of unromantic bravery to think of a divorce fund when rings and garlands are exchanged and vows taken ‘till death do us apart’, but an increasing instance of divorce points to its need. There is no formula to calculate the amounts of compensation but it usually takes into account a number of factors such as incomes of the spouses, the standard of living, and one’s financial needs. Whether one has to pay for the one-time settlement, or permanent alimony, or both, depends on case to case and often comes at the end of lengthy legal wrangling.

We sincerely hope you never have to use such a fund for its intended purpose. If the money is not eventually used, it can be used for a variety of purposes. Perhaps to mutual satisfaction.