Following legislation introduced in 2022, it is now much easier for couples to separate. It is enough to claim a marriage has simply broken down to apply for a divorce. In this blog, we explore the legal consequences and material implications of a marriage dissolution and the potential benefits of approaching divorce solicitors in North Wales.
A financial divorce settlement is an agreement between two spouses on how to separate their assets once the marriage has concluded. It can be drawn up at any time during divorce proceedings or a civil partnership dissolution. Once it has been agreed, a solicitor will draft a binding consent order to formally confirm the division of assets, following the decree nisi annulment of the marriage.
Who is entitled to what after a divorce can be a complex matter and there are different ways through which the legal system can resolve it. The outcome could have a huge bearing on someone’s financial wellbeing and quality of life for years to come.
Marital assets
There is a common belief that couples automatically split their matrimonial assets 50:50, but the carve-up of assets isn’t necessarily that straightforward. Each divorce is unique and will be characterised by different factors.
In legal terms, these might include: income, assets, debts, liabilities or a spouse’s or child’s ‘reasonable needs’. Moreover, any fair divorce settlement might also take into consideration the length of marriage, any pre-nuptial arrangement as well as the financial contributions made by both parties. The reasons for the divorce or who initially sought it are not a determining factor in anyone’s legal entitlement.
The family home
If owned by either or both parties, the family home will typically be divided equally if both names are on the deeds, and potentially shared even if one name is not. The outcome is not influenced by who contributed most to the purchase, deposit or mortgage. Some divorcees may opt to sell and split the proceeds, while others may agree to keep the property in exchange for forfeiting a share of other assets such as their ex-partner’s pension.
Pensions and savings
Compared to property, pensions are sometimes seen as a less high-profile marital asset. Nevertheless, the value of a pension pot needs to still be factored into any divorce arrangement.
Pensions can be divided up in different ways. You might either get part of your ex spouse’s pension pot straight away, which is moved into your own pension scheme. Alternatively, there might be a lump sum after they retire. In some instances, the value of someone’s pension can be offset against other retirement savings or the value of the family home.
Non-marital assets
In legal terms, non-marital or non-matrimonial assets, known also as separate property, are those assets that are commonly understood to belong to one spouse and therefore not divided up. These might include pre-marriage possessions, inheritances, gifts, bank accounts, vehicles or properties acquired earlier in life. These are classified as non-marital provided they are retained as distinct entities from marital assets.
Financial support
In England, financial support, also known as financial remedy, is determined by the court taking into account numerous factors. The ultimate decision may be taken in or out of court, based on mediation to try and secure a mutually acceptable arrangement. If it does go to court, a Consent Order is submitted for approval.
Children
Courts will always prioritise the interests of children first, which is why both parents would be obliged to make contributions to their upbringing until the age of 16. This may involve the Child Maintenance Service as a mediator or be achieved bilaterally. Factors such as salaries and custody will be taken into account when calculating future payments.
Debt
Divorce law in England and Wales considers debts when dividing up assets and liabilities. While debts are the responsibility of the individual who built them up, courts can still make adjustments to involve the other party in repayments in some ‘joint debt’ situations.
For further financial information relating to divorces, it is a good idea to seek legal advice, or to consider mediation if the split is acrimonious. If you are based in North Wales, call our specialist team at Bennett Smith Solicitors today to get personalised advice.
