How are assets split in divorce?
How assets will be split between the separating couple is, unsurprisingly, one of the issues people tend to be most anxious about in a divorce. There are really two sides to this question – first, “who gets what?” i.e. what is each person entitled to and, second, how will the division of assets be decided, i.e. what process will you need to go through?
In this blog, we will look at what people are entitled to when they divorce and how this is determined. We will also cover the different methods that can be used to split finances in divorce, including using alternative dispute resolution to agree a settlement amicably and court proceedings. And please don’t miss our ‘key things to remember when dividing assets in divorce’ at the end of the blog.
Of course, no two divorces are exactly alike, so the information given here is only intended to give a general idea of how divorce finances work. For specific advice tailored to your situation, please get in touch, and we will be happy to help.
What are you entitled to when you get divorced?
It’s a commonly repeated idea that everything will be split on a 50:50 basis during divorce. While this is, legally, the starting point for the division of assets, the reality is rarely that simple. Any division of assets will need to consider what assets are available and the reasonable needs of each spouse, plus any dependants (e.g. children still living at home).
If you need to apply to a court to decide how your assets should be split, the court will also look at factors such as:
- The length of the marriage
- The contribution of each party to the marriage (e.g. child care)
- The standard of living the couple had during the marriage
- And possibly, the terms of any prenuptial agreement or postnuptial agreement
What methods can you use for splitting finances in divorce?
Alternative dispute resolution
In the vast majority of divorces, the division of assets is decided voluntarily between the separating spouses. In some cases, you may already have agreed how to divide your finances, but otherwise, a process known as “alternative dispute resolution” can allow you to reach an amicable agreement.
This might take the form of negotiations between you and your spouse either via or with the support of your lawyers. Alternatively, you might use mediation, which involves working with a trained expert called a mediator who acts as a neutral third party to help facilitate a settlement.
There is an additional process called collaborative law, which involves you, your former spouse and your respective lawyers sitting down together to agree the details of your settlement. Your accountants, financial advisors and other experts may also attend, making sure you have the correct support to ensure a fair settlement that meets your needs.
Benefits of alternative dispute resolution:
- Much faster than court proceedings
- Less likelihood of conflict
- Lower legal fees
- Allows you to retain control of your settlement
- Keeps the details of your finances and the settlement private
- Your settlement can be made legally binding by applying to a court for a Consent Order
Court proceedings
If you cannot agree a settlement voluntarily or this approach would not be appropriate for your situation, then it may be necessary to apply to a court for a Financial Order. This means a court will decide how your assets will be divided.
Benefits of court proceedings:
- You do not have to work with your spouse to decide the division of finances
- The division of assets is decided by an expert using a clear methodology that looks dispassionately at the available assets and requirements of the spouses and any dependants
- You get a definitive, legally binding outcome (subject to any appeals by either spouse)
Key things to remember when dividing assets in divorce
- Obtain early expert advice – The sooner you can speak to an experienced divorce lawyer, the clearer idea you will have of your entitlement. This can significantly increase your chances of achieving a settlement that matches your expectations.
- Both spouses must make a full disclosure of their assets – If you suspect your spouse is trying to hide assets, speak to your lawyer without delay, as there are steps that can be taken to address this.
- Children come first – If there are any children, their needs must be considered first. A court will always make sure the needs of children are met before deciding what each spouse is entitled to.
- Make a clean break of it – You might think that once the division of assets is agreed that’s the end of it. Unfortunately, if you don’t take steps to protect yourself, there is nothing to prevent your former spouse from making a further claim against your assets in future. To avoid this, you must apply for a Clean Break Order, which legally severs the link between your finances, preventing any future claims.
Speak to our divorce solicitor in Clapham about division of assets
Our divorce solicitor in Clapham will carefully listen to your circumstances and financial requirements. We can then provide clear, tailored guidance on what you can expect from the division of assets and your options for reaching a settlement.
Our firm is headed by Donna Goodsell, a highly skilled family law solicitor with over 25 years’ experience. Donna is available to provide a highly personal service in relation to divorce finances, including through alternative dispute resolution and court proceedings.
To speak to us about divorce finances or to arrange an initial consultation, please call 020 7622 2221, email enquiries@goodsellssolicitors.co.uk, or complete our online enquiry form to request a call back.