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Ending a marriage isn't just about separating lives, but also about untangling shared finances. At Pickerings Solicitors, we're here to guide you through every step, ensuring you have a clearer understanding of how you and your ex-partner will distribute shared and individual assets and liabilities.
There are two main ways to divide your assets and money in a divorce. With the assistance of a family lawyer, collaborative lawyer or mediator, you can either;
- mutually agree and formalise it in a consent order or,
- if no agreement can be reached, take the matter to court where a legally binding decision will be made by a judge.
Whichever approach is right for your circumstances, our skilled family lawyers are here to guide and support you throughout the process.
What is a financial settlement in divorce?
It's essentially a plan of how you and your ex will divide your shared and individual assets and liabilities.
What is included in a financial settlement?
It often includes:
- Monetary Assets: Like savings, investments, and insurance.
- Property: Your main home and any other property.
- Domestic Assets: Household items, especially if they're worth more than £500.
- Cars and vehicles.
- Retirement Resources: Pensions and related assets.
- Businesses: Including any shares or stakes in businesses.
- Financial Liabilities: Debts, loans, and credit card obligations.
How can I reach a financial settlement agreement with my ex?
There are various ways. Some couples mutually agree and put their agreement into legal documents. Others might need to go to court. Our legal team is here to recommend the best approach for your specific situation.
Do I need a formal financial settlement?
Yes it is advisable. It ensures that both parties have legal clarity regarding their financial obligations and entitlements post-divorce. This formal agreement can also limit or prevent future disputes and claims and provides a clear path for both parties to move forward. We will advise you on what type of formal agreement is suitable in your case.
How much does it cost for a financial settlement in divorce?
We recommend that you approach the financial aspect of your divorce with the understanding that both you and your partner will be responsible for your own individual legal costs.
When it comes to negotiating a financial settlement, providing precise cost estimates can be challenging. However, Pickerings Solicitors will always offer you a clear cost estimate before proceeding with financial negotiations.
In cases where the assets involved are minimal or both parties have already decided on the asset distribution, it may simply entail having a lawyer draft a clean break consent order. A clean break consent order is a legal document that, when approved by the court, can be used to formalise the financial agreement reached between divorcing parties. It typically outlines the division of assets and can help prevent future financial claims.
How do I determine the asset's value in a financial settlement?
Assets are typically valued based on their current market net value. For some items, like homes, this might require a formal valuation. For other assets, such as stocks, the market value at a specific date might be used. Sale costs and tax are usually deducted when valuing an asset.
Can financial settlements be changed after they have been agreed upon?
Generally, once a financial settlement is formalised, as a clean break order, it is binding. However, in certain circumstances, if there is a significant change in either party's financial situation or if new assets are discovered, the agreement might be revisited. Orders for spousal maintenance are capable of being varied.
Will the length of my marriage affect my financial settlement?
The duration of the marriage can influence the financial settlement. A longer marriage may lead to assets being divided more equitably, especially if one partner has sacrificed their career or earnings potential for the sake of the marriage or family.
How are future earnings and potential inheritances calculated in a financial settlement?
Future earnings, as a rule, aren't divided in a divorce. However, the potential future earnings of one party can influence spousal maintenance decisions. While inheritances received during the marriage will be taken into account when considering what the parties needs are, they aren't always divided between the parties. Future inheritances are typically not considered in settlements.
What happens if one party hides assets or is not transparent about their finances during the settlement process?
Concealing assets is considered fraudulent. If discovered, the affected party could return to court for a revised settlement, and the party hiding assets might face penalties, costs or a revised financial settlement may be ordered.
Is spousal maintenance always included in the financial settlement?
No. Whether one party receives spousal support, and the amount and duration of that support, will depend on various factors including the financial situation of both parties, the length of the marriage, and the needs of the parties involved.
How do we ensure that the financial settlement is fair to both parties?
A financial settlement takes into account the contributions (both financial and non-financial) of each party to the marriage, their current and future needs, and their individual circumstances. Employing a skilled family lawyer, can provide guidance and ensure the fairness of the agreement.
Call one of our specialist family lawyers on 01827 317070 or email sdavies@pickerings-solicitors.com
