Regardless of the assets in a case, an application for divorce and the prospect of trying to reach a financial settlement can be daunting. However, high net worth cases can quickly become more complex. This is largely because of the type of assets...
Divorce financial settlements
If you are dealing with a divorce or separation, Harrowells team of divorce solicitors and family law specialists are here to achieve the best outcome for you
It is vital to understand where you stand legally before committing to any proposals, and it is advisable to get family law advice from a divorce lawyer at an early stage, before any decisions are made. At Harrowells we offer initial confidential appointments to all new clients so that you can discuss any concerns you have, work out with your solicitor what your main objectives are and find out the best way to achieve them.
Before reaching a divorce settlement, you and your ex partner owe each other a duty of “full and frank disclosure”. This means you should be totally open and honest about how much money and property you own, including: income, investments, savings, dividends, property, pensions, and any other assets or liabilities you may have. Once you have exchanged financial disclosure, your solicitor will be able to offer divorce financial advice and give you guidance on reaching a financial settlement.
The law operates on a principle of fairness when it comes to the division of money and property upon divorce or dissolution. An equal division of the capital assets between the couple is often the starting point, particularly in longer marriages where there are children. However, in reality, one spouse is usually in a better or worse financial position than their former partner and in these situations, a financial order where there unequal split may be required to meet needs and achieve fairness.
The process of obtaining a divorce settlement can seem confusing and intimidating, with lots of paperwork and legal details you need to get right. Our divorce lawyers will guide you every step of the way and provide all of the family law services you will need, making sure everything is done correctly, so you can formally end your relationship as smoothly as possible.
We will also adopt a style that best works for you. Divorce does not need to be antagonistic and it doesn’t mean that we cannot work amicably and constructively. What we will do is set out the options for you and let you tell us how you want us to handle things for you.
We know that every divorce is different and managing your ex-partner can feel like an impossible task but our experience allows us to effectively manage even the most difficult and narcissistic divorces.
Read our Guide to High Net Worth Divorces.
At Harrowells we have a strong team of family and divorce solicitors, who are supported by the wider team. You will always deal with the same members of staff who make it a priority to get to know you and your circumstances.
Contact our friendly, expert divorce lawyers
Whilst we are physically based in Yorkshire, because of our recognised expertise and effectiveness in dealing with divorce and family law matters, we regularly assist clients throughout the UK.
We are very happy to hold meetings by phone or video call as well as, for more locally based clients, at one of our network of offices across North and East Yorkshire.
Contact us today to speak to a specialist divorce lawyer with the skills and experience to fight your corner and protect your interests.
Our financial settlements service
Divorce and Property
Your capital and property assets are likely to include the following:
- The family home (often referred to as the former matrimonial home)
- Other properties, such as buy to let investment properties and holiday homes
- Savings, shares and investments
- Businesses – such as shareholdings
What will happen to the family home is likely to be your first concern as this is often the most valuable assts. There are options other than sale, for example we can look at offsetting this against other assets, deferring the sale to a date in the future or a buy out of the other party’s interest.
Pensions are often one of the most valuable but also the most overlooked of the assets. Every pension has a value to it (often referred to as the cash equivalent value or CEV) and this should be obtained for every pension arrangement you have. The information is then usually referred to a pension actuary, who can provide details on how the pension should be shared or offset against other assets.
Divorce and Business Assets
In the same way as property is, business interests are taken into account as part of a couple’s matrimonial assets and should be divided fairly upon divorce or dissolution. Your interest in the business will be valued and the level of income you generate will also be looked into before options for division or offset can be reviewed.
Family court judges are generally unwilling to disrupt the running of a business by splitting its assets if an alternative can be found. Therefore, a popular option is to allow one partner to keep the business whilst the other gets a greater share of the assets and/or spousal maintenance.
Spousal maintenance is paid to the lower earning spouse by the other, and is paid in circumstances in which they are maximising their earning capacity but are not able to meet their reasonable needs without support from the other. The higher earning spouse must have surplus income, after meeting their day to day needs, from their income.
This is governed by the Child Maintenance Service (CMS formerly the CSA) and a useful tool is the calculator on the government website: https://www.gov.uk/calculate-child-maintenance
Unless the paying parents earns over the threshold, the family court will not get involved in calculating child maintenance and agreement you may reach will only last for 12 months when the CMS will take over.
Options for achieving a financial separation during divorce
Financial matters tend to be arranged in parallel to the procedural aspects of divorce and the vast majority of financial settlements are successfully negotiated via solicitors without going to court. The agreed settlement will be made legally binding by applying to court for a ‘Consent Order.’
If we cannot reach an agreement in this way, you may consider attending mediation which is a precursor to applying to the family court (though this is not always appropriate and there are exemptions) or via arbitration.
We have considerable experience helping clients come to amicable agreements, negotiating settlements which work for every member of the family, even in complex scenarios involving businesses, agricultural matters, high net worth individuals, and overseas property The majority of our cases are resolved by consent, but if a court application is required then we will support you and protect your interests. The court process can be beneficial in cases where there is delay as it puts in place a formal timetable, and in divorces where one party is or has demonstrated narcissistic traits.
Divorce Financial Fees
We believe firmly in costs transparency so we will discuss the divorce solicitor cost and fees up front and ensure that we have a pricing plan in place to suit your budget. We will discuss with you the option of fixed fee divorces and deferred fee arrangements to ensure that it remains affordable for you to instruct one of our divorce solicitors.
Splitting finances in divorce explained
What am I entitled to in divorce?
The starting point is an equal division of the marital assets. However, this is not always fair and adjustments will be made to take into account contributions and need.
Does everything get split 50:50 in divorce?
No, it is very rare that an equal division is reached once full disclosure has taken place. This is just the starting point.
What is a reasonable divorce settlement?
A financial order which takes into account all of the factors set out in law which include: earning capacity; financial needs and resources; standard of living; ages and length of the marriage; and contributions and obligations.
What assets are included in a divorce settlement?
All of your assets will be considered, but it may be possible to exclude non-matrimonial assets (such as inheritance or monies that you had before you started your relationship) but that will depend on other circumstances.
Does the length of a marriage affect the divorce settlement?
Yes, the longer you have been married the more likely it is that your settlement will be close to 50:50.
Can I divorce my spouse and keep everything?
No this is very unlikely as your spouse’s needs will need to be met.
Will a pre-nuptial agreement be enforceable during divorce?
A prenuptial agreement is essential if you have more at stake that your spouse. Whilst they are not cast-iron, it is very difficult for your ex-partner to get out of the terms in a prenup if they have been properly entered into and if their reasonable needs are met.
How long does it take to separate finances in divorce?
The average case takes 6-12 months.
Divorce and finances insights from Harrowells
A list of links to the following divorce and finances blogs:
- Will my redundancy money be shared in my divorce?
- Bitcoin and Divorce
- What financial information is required before a divorce settlement can be reached?
- How are the value of future pensions taken into account on divorce?
Contact our friendly, expert divorce lawyers
Looking for clear, practical advice and support for any area of divorce law? Our divorce law solicitors can arrange meetings at any of our offices, over the telephone or via video to suit you.