Financial clarity on divorce: What you need to know

Whilst very common, modest asset divorces are rarely reported due to parties having a lack of funds to access legal advice. As a result, many couples resort to do-it-yourself, or DIY divorce. However, cheap shortcuts can lead to very expensive issues in the future.

Most couples will not be aware that divorce proceedings and financial proceedings are completely separate, and a separate application has to be made if you wish to record a financial agreement reached on divorce with the Family Court.

Some couples are wary of involving solicitors in negotiations due to cost or in the belief solicitors will prevent matters from being resolved cooperatively. However, most family law solicitors are committed to a non-confrontational approach and working towards an outcome which is beneficial for the whole family.

It is recommended you approach a Resolution accredited family lawyer who are committed to a Code of Practice, which promotes a constructive approach to family issues - You can find a Resolution Family law expert here or view our Family finances team here. 

There are many hidden pitfalls associated with DIY divorce without proper legal advice including:

• If you divorce but fail to record any financial agreement with the Court, your ex-spouse could still make a financial claim at a later date, as there are no time-limits for bringing such a claim. This may leave you, or your estate, financially vulnerable.

• If you get divorced and remarry before your financial claims are resolved this may impact on the financial claim you can make against your ex-spouse.

• The importance of pension benefits can be forgotten or not properly understood. This can leave one party at a significant financial disadvantage when approaching retirement.

In the fog of stress, associated implications of divorce can be overlooked such as its effect on immigration status and taxes, particularly if a business is involved.

The right legal advice will manage these problems and others which can materialise years after your divorce is finalised and sometimes, even after death. It will also help you to achieve a fair financial settlement in the most cost-effective way.

Support

At Porter Dodson we have a dedicated team to advise on separation/divorce, with Resolution accredited specialists. Should you require assistance please contact our family law team on 01935 424581.

See our blog on Non-Court Dispute Resolution Methods to understand the different ways in which a financial agreement can be reached.