Financial Settlements on Divorce: What am I Entitled to?
Navigating the financial complexities of divorce can be overwhelming. Family Lawyer, Katie Copsey discusses the ins and outs of ‘Financial Settlements on Divorce’ in her latest blog…
Equality & Need in a Financial Settlement After Divorce
When a marriage or civil partnership comes to an end, there are often many challenges to navigate. One of these is deciding how the family’s financial resources and obligations should be divided.
The starting point for the court when looking at what may be a fair financial settlement will be to look at an equal division of all the family finances. This is known as the sharing principle.
However, rarely is an exact 50/50 division of the assets the outcome in a financial settlement. This is because the Court can move away from this if equality does not produce a fair outcome.
How do the Court Consider What is Fair?
The Court may deviate away from a 50/50 split where a move from a 50/50 split is justified. This can be because one party needs more capital than the other or has contributed significantly more towards the family’s financial circumstances or has received a large inheritance that should be ringfenced from the settlement. The Family Courts have long recognised that the role of raising children is as much of a contribution to the marriage as being the main earner.
The Court’s first consideration is to the welfare of the children involved. Alongside this, they have a list of principles that they apply to each individual case to consider what a fair outcome should be.
1. The income, earning capacity, property and other financial resources
2. The financial needs, obligations and responsibilities
3. The standard of living enjoyed during the marriage
4. The age of each party and the duration of the marriage
5. Any physical or mental disability
6. The contributions which each of the parties has made
7. The conduct of each of the parties
8. In the case of proceedings for divorce or nullity of marriage, the value to each of the parties to the marriage of any benefit
What are Reasonable Needs?
This is a broad concept but ultimately includes provision for a person’s housing and other capital needs and requirement for income to sustain a reasonable standard of living and, of course, those of any dependent children. What is considered reasonable is determined on a case-by-case basis when looking at the specific family’s financial circumstances.
My Spouse and I have Agreed a Financial Settlement. Do we Still Need a Lawyer and Court Order?
Fantastic news!
We would still recommend you take independent legal advice about the agreement reached so that we can make sure the settlement reached is fair and appropriate for you.
We can also help convert the agreement reached, into a Court Order. A Court Order will make your agreement legally binding and enforceable. It can also include a ‘clean break’ clause which ends all future matrimonial ties between you and your spouse so that after the terms of the financial settlement have been implemented.
What if I don’t want to get a Lawyer & Court Order?
Without such an order, there is no legal end to your financial claims against each other.
Your claim remains open even after the divorce has concluded. This means, if in the future, you have a successful business venture, inheritance or even a lottery win, your ex-spouse has a claim on this.
What if my Spouse and I can’t agree a Financial Settlement?
For many reasons, reaching an agreement between yourselves whilst navigating separation is not always possible.
There are many other ways that an agreement can be reached. Some of these options are listed below:
• Lawyer negotiation
• Mediation
• Collaborative law
• Arbitration
• Court
How Can Timms Help?
Our Family Law team can help you decide which route is best for your family and deal with any queries. If you would like any further information, please contact me at k.copsey@timms-law.com or call freephone 0800 011 6666.
August 2024