Once you’ve taken the decision to divorce you will need to reach a formal financial settlement. A financial settlement is legally binding and covers the specifics of how to deal with your financial assets following separation.
Do you need a financial settlement as part of a divorce?
Whilst you can still be granted a divorce without a financial settlement, it is highly advisable to obtain one. This will avoid any complications, delays or further legal costs. The court can approve any financial settlement from the decree nisi stage in the divorce. Without a financial settlement, you can run the risk of not receiving what you are entitled to. Your ex partner could also try and make a financial claim against you in the future, even years after the divorce is finalised.
It is important that a financial settlement is approved by a court. If it isn’t, it will not be legally binding and could leave you at risk of further disputes later.
What are financial assets?
Financial assets are what you and your spouse/civil partner have built up during your marriage/partnership. These can include assets such as the family home, properties, cash and savings, pensions, vehicles, home contents and businesses.
The court would also consider any debts, such as a mortgage, loans, credit cards and other commitments.
Non-matrimonial assets are financial assets (such as those listed above) which were acquired either before the marriage/civil partnership or after separation. They would therefore be treated differently to matrimonial assets but wouldn’t necessarily be excluded from a divorce settlement.
How are assets split in a financial settlement?
Whilst the aim of the divorce court will be to divide assets in a fair and equal way, this does not always mean being split 50/50. Other factors such as the needs of each party, child arrangements and future earnings potential will all be involved in the decision.
How to protect your assets and future assets
For most divorcing couples who own one, the family home is probably the biggest asset involved in any settlement. It can also be one of the biggest causes of stress and friction. There are several options in how this can be split, from selling now or later, and splitting the equity, to buying out, transfer or other options. These options ought to be advised on by a Solicitor.
The best way to ensure that you are a receiving a fair settlement is to seek early legal advice. See here for more information on financial settlements.
What if both parties can’t agree?
Negotiating a settlement can be difficult, stressful and emotionally challenging. We are here to help you handle the division of finances and assets as successfully as possible.
It is often possible to avoid the strain and expense of going to court by reaching a settlement through our expert divorce lawyers. We also have a qualified collaborative law team.
However, if an amicable resolution is not possible, our solicitors will support you through any court appearances to ensure any financial settlement is fair and appropriate.
Will a divorce financial settlement affect my benefits