What am I entitled to in a divorce settlement?

Getting divorced is often an incredibly difficult and emotional time, with so much to sort out along the way. Together with deciding custody arrangements for children if you have them, one of the most challenging aspects of divorce is usually the process of splitting the financial assets as part of the divorce settlement.

While no-fault divorce laws have been introduced to make getting divorced less complicated and less stressful (in theory), it can still be exhausting and upsetting, which is why it pays to get professional help from a family law solicitor.

In this article, we’ll have a more in-depth look at the financial aspect of who gets what in a divorce settlement, including what you might be entitled to and, if adultery is involved, how this might affect your divorce settlement.

What is a financial settlement?

A financial settlement in divorce is an agreement between both parties on how to split all relevant assets, including things like property, savings, investments and pensions. If there are dependant children involved, it could also set out the details of child maintenance payments going forward.

Couples can avoid the often longer and more expensive court route if they are able to create a financial agreement between them. However, this settlement has to be made legally binding by seeking court approval through a consent order. This is the only way the document can protect your position, both now and in the future.

Professional mediators can help draw up the agreement and you’ll need a trusted lawyer to draft the consent order for you. As long as they think it’s fair, a judge will usually approve the order without the need for you to attend a court hearing.

If you can’t agree on a financial settlement however, you can ask the court to decide. This is typically more expensive and you’ll need to show you’ve tried mediation first (apart from certain cases, such as where there’s been domestic abuse, for example).

What assets am I entitled to in a divorce settlement?

There is no one answer to who gets what in a divorce and no typical divorce settlement. The law is deliberately designed to allow for a large amount of discretion so that settlements can be agreed on a case-by-case basis, in a way that is ‘fair’ to both parties. And ‘fair’ in this respect doesn’t always mean a straight-forward 50/50 split in financial value.

The bigger focus is on ensuring both parties are left in an equal position afterwards, and able to become financially independent of one another as quickly as possible.

A whole range of money and assets can be pulled into the financial settlement, including pensions, properties, savings, investments, inheritances, child maintenance, regular living expenses, vehicles, businesses, fine art, antiques and jewellery.

For the purposes of divorce, assets are usually referred to as either ‘marital assets’ or ‘pre-marital assets’.

Marital Assets

These are any assets that have been acquired during the marriage. In England and Wales, these belong legally to both spouses.

Some finances are commonly overlooked, such as pensions, as many divorcing couples do not realise that ex-partners are entitled to a share of a pension you paid into while married, even if they didn’t contribute directly. Pensions are often one of the main sources of wealth in a marriage and can therefore lead to one party finding themselves in pension poverty if it hasn’t been factored in.

Pre-Marital Assets

These are assets that someone acquired before the marriage and are therefore treated differently. It doesn’t necessarily mean they don’t apply to a financial settlement, but determining whether and how they should be split is usually more complex.

For example, if someone gained an inheritance before they got married, but used it during the marriage to pay for a house or car, the item would be classed as a marital asset.

How pre-marital assets are divided will also depend on individual circumstances, the future needs of both parties, and whether there are any pre-nuptial agreements in place.

What makes a fair divorce settlement?

We explained above how courts will always look to ensure that a divorce settlement is ‘fair’ to both parties and that it varies from case to case – but what makes it fair?

Under Section 25 of the Matrimonial Causes Act 1973 and the Civil Partnerships Act 2004, there are several factors that courts have to take into account when dividing assets in a UK divorce.

These include:

• The welfare of any children involved – this can also impact who gets to keep the house in a divorce
• The financial needs, obligations and responsibilities each party has now or is likely to have in the near future
• Income and ability to earn
• The standard of living both enjoyed before the marriage breakdown
• Age and any physical or mental disability of either party
• Contributions made to the welfare of the family, including looking after the home or caring for the family

Can adultery affect a divorce settlement?

Contrary to what might still be popular belief, adultery is no longer a factor in divorce. Since the introduction of the new ‘no fault’ divorce laws in April 2022, people no longer need to submit particular grounds for divorce, such as adultery.

It’s now sufficient to simply cite an ‘irretrievable breakdown of marriage’ – and no reasons need to be given for this either.

It means both parties are treated equally when it comes to determining a financial settlement, and while this may not be 50/50 due to the reasons above, a person’s adultery will not result in a greater share, or any other form of financial compensation, for the other person.

Adultery, therefore, has no impact on the financial settlement and is not generally a factor in childcare arrangements either.

How can Alsters Kelley help with my divorce settlement?

Every situation is completely unique and every divorce is unique, but our kind, friendly and helpful solicitors are here to guide you every step of the way, no matter what your individual circumstances. We will always handle your case with the utmost care and sensitivity and with your best interests at heart.

Sound legal advice at the outset is key to resolving your divorce as quickly and smoothly as possible and with the best long-term outcomes for you and your family.

The Alsters Kelley family lawyers are also members of Resolution, a community of family justice professionals who work with families and individuals to resolve issues in a constructive way.

If you would like some legal advice on divorce or separation, please contact Shelley DeWorringham, Head of Family Law, telephone 01926 356000, or email shelleydeworringham@alsterskelley.com.