What happens when divorcing parents put money before their kids

Two weeks after Charlie left his wife, Sarah, and their two children, Archie and Tom, he announced he wasn't paying private school fees anymore. The kids could go to a public school, he said.

Sarah could see that their kids were distressed and grieving, but changing schools, leaving their teachers and friends, would make it worse. As she couldn't afford the school fees on her own and Charlie wouldn't budge on contributing to them, she borrowed money from her family to help cover the cost until they divided the property.

Little did Sarah know that the property settlement would drag on for years and she had to keep borrowing money for the school fees. But she is happy she prioritised her kids' wellbeing and kept them at their high school.

Focusing on the needs of children and minimising the upheaval of a separation on them should be a priority in a divorce. But it isn't easy. Disagreements over schooling are one of many decisions to negotiate. Plenty of kids do change schools and adapt.

Accessing psychologists and counsellors for them - as well as for the parents - can help deal with the emotional roller coaster ride of a family separation.

This is because a separation or divorce is psychologically the second most devastating event in life, ranking just behind death of a spouse or other loved one. Around 49,000 divorces were granted in 2019 in Australia compared with 113,815 marriages.

While everyone usually fares badly after divorce, women and children are more likely to be in financial hardship, particularly in the short to medium term, according to the Australian Institute of Family Studies.

Divorced families tend to have fewer assets, including super and property, than those in a couple. The cost of living is considerably higher when you're single.

Older women, in particular, are devastated by divorce. Late-life divorce - and staying single - shatters their retirement plans, plunging many older women into poverty and even leading to homelessness.

Women need to make smart decisions to ensure they aren't ruined financially. A common mistake is to hang onto the family home when it can be a black hole of expenses such as the mortgage, council rates, upkeep and emergency repairs. Another is to support adult children who often have endless financial needs, when you can't really afford to do so.

One of the golden rules of a "good" divorce is to have your dignity intact at the end of the process. Another is to try to avoid a costly, drawn-out split. The two go hand in hand because it will be cheaper to settle if the parties treat each other in a civilised, mature manner.

Divorce costs can be contained to around $1000 if a property settlement can be easily reached. But expenses begin to climb if one person is not ready to move on or look at what is a reasonable financial settlement.

This was the case with Charlie and Sarah. He was more adversarial and his legal bills reached $140,000. Sarah spent $65,000 and says she felt caught up in a game between lawyers deliberately dragging out the 
settlement to their own advantage.

The hourly rate is upwards of $350 and you can expect to pay $650 an hour or more for an experienced family lawyer. You may need a forensic accountant to locate assets and they can be as expensive as a family lawyer. But there is no guarantee that they will find what you believe is hidden.

Mediation and conciliation are becoming more popular as a way to settle parenting matters and financial affairs. It helps avoid ongoing litigation and court proceedings.

Reports of litigation funders, usually associated with class actions, and alarming legal bills for divorces have been emerging this year.

One Sydney woman pawned her jewellery, sold paintings and borrowed money from her parents to run up $6 million in legal fees in a dispute with her husband, who is reportedly worth $200 million. Both the woman and her husband used the best-known and highest-charging lawyers in Sydney and her husband made 48 applications to court.

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