Navigating through the complexities of a divorce can be daunting, particularly when it comes to disentangling your financial lives. Here, we explore the essential steps and considerations for managing your finances during a divorce, ensuring you are fully prepared to address this challenging aspect with confidence and clarity.
Working out how much professional help you need
At Moore Barlow, we understand that determining the level of professional assistance needed during a divorce can vary greatly depending on the complexity of your case.
It is important to note that, whilst the stages of obtaining a divorce are linked to the resolution of financial matters (for example, the conditional order needs to have been pronounced in the divorce in order for the court to make a final financial order), the divorce proceedings are separate from the resolution of financial matters.
In terms of financial matters:
- Self-management: You may choose to handle the negotiations and paperwork on your own, using online resources to assist with the simpler tasks.
- Limited legal advice: Engaging with a solicitor for a few advisory sessions can be beneficial while managing most of the documentation yourself. This can be a cost-effective way to ensure legal accuracy in your proceedings.
- Mediation services: Using a mediator can facilitate a more amicable agreement between you and your former partner, often leading to a smoother resolution.
- Comprehensive legal support: For complete support throughout your divorce, including intricate financial settlements, our solicitors can guide you every step of the way. Be mindful, extensive legal support can become costly, particularly if prolonged negotiations are involved and/or if there are contested court proceedings.
Choosing the right level of support can significantly impact the efficiency and outcome of resolving financial matters. At Moore Barlow, we’re here to help you choose the most suitable approach tailored to your specific needs.
Explore our finances and divorce legal services
Our team of experienced financial settlement solicitors provide expert legal advice and support to clients in all aspects of these complex and dynamic areas of business.
Is separating your finances easy?
Determining whether to handle your financial separation independently or seek professional advice can be challenging. The simplicity of the process often depends on mutual agreement between both parties regarding the fair division of assets and whether there should be any ongoing spousal maintenance (child maintenance is usually dealt with separately and in accordance with the Child Maintenance Service). If there are no dependent children and no financial dependency between the parties, the process tends to be smoother.
However, disagreements over how to divide assets, such as property and pensions, can complicate matters, making professional guidance advisable to facilitate amicable negotiations and ensure fair outcomes.
When separating your finances might be complicated
The complexity of your financial landscape significantly influences the duration and difficulty of reaching a financial settlement on divorce. Professional assistance is often necessary in more intricate cases.
Consider seeking help if any of the following apply:
- either party owns a business;
- there is financial dependency between you;
- disagreement on the divorce itself;
- children who financially depend on you;
- a marriage or civil partnership exceeding five years;
- a party with a disability impacting their income;
- a party who has sacrificed career opportunities for family care; and/or
- there is substantial disparity in asset ownership between you.
Understanding financial settlements
A financial settlement in a divorce refers to the legal agreement that outlines how the couple’s finances will be divided. This includes everything from property and savings to pensions and debts.
Key considerations
- Asset and liability assessment: Begin by gathering comprehensive details about all assets and liabilities. This includes bank accounts, property, investments, and any debts. Accurate valuation of these assets is crucial for fair distribution.
- Income and future needs: Assess each party’s income and future financial needs. This assessment will influence maintenance agreements and the division of assets.
Our team of family law solicitors
Legal framework and process
Initial financial disclosure
Both parties disclose their financial details, providing a foundation for negotiations. This step is vital for transparency and forms the basis of equitable settlement discussions.
Negotiation and mediation
If possible, resolve financial disputes through negotiation or mediation. These methods are cost-effective and less adversarial, fostering a cooperative approach to settlement.
Court involvement
If an agreement cannot be reached through mediation or negotiation alone, the matter may need to go to court. If an agreement is not reached during the course of the proceedings, a judge will then make decisions at a final hearing based on fairness and the financial information provided.
Deciding on a clean break
A clean break means both parties sever all financial ties. While ideal, it’s not always feasible, especially if ongoing support like spousal maintenance is required.
When to consider a clean break:
- No dependents are involved, and both parties are financially independent.
- Both parties agree to a one-time settlement without the need for ongoing support.
Maintenance considerations
Spousal maintenance
This is considered when one party cannot support themselves financially post-divorce and the other party has the means to assist. It can be paid in a lump sum or as ongoing payments.
Child support
Separate from spousal maintenance, child support ensures any children involved are financially supported. As explained above, child maintenance is usually dealt in accordance with the Child Maintenance Service’s statutory formula, though there are some circumstances where the court can order payments for the benefit of a child.
You might also be interested in…
Understanding financial remedy proceedings: A comprehensive guide
ExploreOur family and divorce law insights
Finalising the financial settlement
Once an agreement is reached, it’s crucial to have it legally documented and approved by the court. This process involves drafting a consent order, which ensures the agreement is legally binding and enforceable.
Why legal ratification is essential:
- Prevents future financial claims.
- Provides both parties with security and peace of mind.
- Legally formalises the division of assets and any maintenance agreements.
How Moore Barlow can help
Divorce is a significant life event that requires careful financial planning and legal consideration. By understanding the process and actively engaging in the management of your financial settlement, you can ensure a fair outcome that supports your future financial independence.
At Moore Barlow, our approach is to guide you through these complex proceedings with empathy and expertise. We aim to protect your interests while striving for an outcome that facilitates your transition into post-divorce life with security and confidence.
Explore our full range of divorce and finance legal services
Explore our finances and divorce legal services
Our team of experienced financial settlement solicitors provide expert legal advice and support to clients in all aspects of these complex and dynamic areas of business.