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Financial Issues in Divorce and Separation


The organisation of your financial affairs, as part of divorce or separation, is a sensitive and complex process. Our experienced and approachable family law solicitors will support you through these negotiations, providing objective and clear advice aiming to settle all issues quickly and successfully.

The aim of financial settlement at the time of divorce or separation is to meet the reasonable needs of both parties and any dependent children, including their housing needs. Section 25 of the Matrimonial Causes Act sets out the factors for determining the distribution of assets on divorce or separation. The previous standard of living enjoyed by the parties, as well as the value of assets built up during the period of marriage/civil partnership (and sometimes outside that period), all need to be considered. The court will take all the circumstances of the individual case into consideration and has a significant amount of discretion.

It is important to remember that there is a broad range of reasonable settlement outcomes. What you ultimately receive will be what you and your partner agree or, if necessary, the court, decides is fair. Getting advice early on your financial situation ensures you get a realistic understanding of what you can expect to receive and means you can plan with confidence. We are passionate about securing the fairest financial settlements for our clients in the most stress-free way, allowing them to concentrate on their next steps.

Our Expertise

We are proud of our reputation for legal expertise, and equally proud to be known as passionate and caring people. We are tenacious and determined in ensuring that your interests are served, but we are also warm and compassionate, committed to providing the best client service on the market. Our team understands that negotiation is usually the most effective way to achieve a settlement, and we are experts in resolving matters without involving court proceedings. Key members of our team are noted for their expertise in this area, with Lisa Grimmett highlighted by Chambers UK for her work in Collaborative Law.

Our expertise in sensitively and professionally dealing with your financial affairs during divorce or separation is complemented by our passion for understanding your individual circumstances. An indication of our commitment to our clients is our signature of the Armed Forces Covenant and our position as a member on the NFU’s legal panel. We are delighted to make the undertakings required to achieve these positions because we understand the unique issues that can affect members of these communities.

This commitment to customer service extends to our flexible pricing options. We know that the cost of legal services is a concern for many people, and we know that you don’t want to make compromises in relation to the quality of advice you receive. Therefore, we have a number of fee arrangements, including fixed fees and staged payment options, to suit your budget. We will discuss all aspects of cost with you in advance and are committed to full transparency in our pricing, so you will always know what your costs are and when you will need to pay.

As one of the top law firms across our regions, we have the expertise and experience to support you whatever your circumstances. From our bases in Shropshire, Herefordshire and North Wales, we work with clients from across England and Wales. Contact us to discuss your situation, and we can give you more information on the options available to you.

Financial Settlements

Working out exactly what your assets are is the first step in your financial settlement. We can support you through this process and provide advice on how to determine the value of your assets.

You must declare all assets during this process, including any assets which you consider your sole property. Unfortunately, experience shows, sometimes a partner may attempt to hide assets when separation seems inevitable, an action that will always be viewed in a dim light by the courts. Speak to us immediately if you suspect that your partner is taking steps to hide assets before divorce or separation proceedings begin or during the process.

Matrimonial assets

Matrimonial, or marital, assets are the financial assets acquired during the period of marriage/civil partnership, and typically include:

  • Family home
  • Other property such as holiday homes and rentals
  • Pensions
  • Savings and investments
  • Bank and building society balances
  • Stocks, bonds and mutual funds
  • Businesses
  • Vehicles
  • Furniture and household contents

Non-matrimonial assets

Financial assets acquired before marriage/civil partnership or after separation are usually treated differently. These are known as non-matrimonial assets. While these assets may be excluded from any financial settlement, that is not necessarily the case. Assets acquired prior to marriage/civil partnership, but then used to acquire items during the marriage/civil partnership, could be included in the financial settlement, for example.


You should also determine the extent of any debts which have accrued during the period of marriage. It is especially important to organise any debts which are in joint names (joint credit cards or loans taken out together) because creditors can pursue either one of you individually for the debt. As such, should your partner stop making repayments, that obligation would fall solely upon you.

We have a vast amount of experience in unravelling complex financial relationships and will support you throughout the process. We will advise you on the extent of your personal obligations for any debts accrued during your relationship and on the process for financially separating yourself from your joint obligations.

Unethical behaviour

During the financial settlement process, both you and your partner will continue to spend money on living expenses, so may need access to jointly held and accrued funds. Occasionally, situations arise when a spouse or partner makes large withdrawals from a joint account without agreement or seeks to run up large debts in your joint names. If you are concerned about the possibility of your partner acting in this way, contact us and we can explain the precautions which can be taken.

On-going arrangements

In circumstances when one party to the divorce or separation does not have the means to support themselves or any dependents financially, arrangements are usually made for on-going payments. This situation can arise where one party was the sole earner in a relationship. Payments can be for a fixed term or for life.

We have vast experience dealing with these matters and will work together with you to ensure a smooth and reasonable result. We can also advise you of your legal options if a former partner fails to keep up their commitments to on-going payments, including arranging for a court order enforcing payment.

Financial Orders

In most cases, a financial order from a court is required. Our focus is always on working together with our clients to achieve an amicable out of court settlement whenever possible, backed up with a financial consent order. If you are unable to reach an agreement, then an application can be made to court for financial aspects of your divorce to be determined.

We will act on your behalf in these proceedings, using our knowledge and experience to seek to ensure a fair and satisfactory outcome. The court will consider the length of your relationship, the range of assets, the specific circumstances of each party (including health and earning capacity), the needs of any children of the relationship and the reasonable income and capital needs of each party.

Post-divorce Finances

It is vital to make your financial settlement legally binding because changes to your circumstances following divorce or separation can result in a financial claim. This can happen if one party to the proceedings earns or inherits a large amount of money post-separation, or if one party re-evaluates matters and decides that they have been treated unfairly.

There are cases where changes in financial circumstances decades after a separation have resulted in successful claims. To avoid the possibility of this happening, we will ensure your financial settlement is legally binding.

Pre-Nuptial Agreements

Some couples choose to agree what will happen to their assets, in the event of a breakdown of the relationship, at the outset. Pre-nuptial agreements (or prenups) of this sort are not fully legally binding but will be considered by the court and followed, providing certain requirements are satisfied.

Our experienced team has worked on pre-nuptial agreements for people from a wide range of backgrounds and understand both the legal requirements and the practical sensitivities. We will ensure your arrangements abide by the guidelines and fully recognise your wishes. 

If you have a prenup in place, it is important that you discuss the agreement with us to ensure you are clear about what was agreed.

Post-Nuptial Agreements

Post-nuptial agreements serve the same purpose as a prenup, but tend to be less common, simply because they are drawn up after marriage/civil partnership. A post-nuptial agreement is a sensible arrangement to put in place especially if your financial circumstances change during the marriage/civil partnership, in the case of a significant inheritance, for example.

We can provide advice on whether a post-nuptial agreement is an appropriate option for you, if your financial situation has changed, or if you expect it to at some point. We have experience drafting these arrangements and understand the complexities involved.

Pensions & Divorce

Provision needs to be made in any financial settlement for the position of each party in retirement. There are three main ways that pensions are dealt with on divorce.

Pension sharing

Pension sharing is a common, tax efficient, approach. The value of the pension held by one party is split, ensuring that each partner has their own pension. This allows for a clean break in financial arrangements, and each partner can then deal with their share of the pension pot as they wish.

Pension offsetting

Another option is to offset the value of the pension against other assets, allocating assets of a different nature, such as the family home, to the other person. This allows one partner to keep the whole of the pension, while the other partner is adequately provided for. This is also finalised on divorce, so allows for a clean financial break.

The offsetting process may involve one partner receiving a greater share of the family home, or other property. We will work together with you to accurately value all your assets to ensure that any division is fair.

Pension attachment order

A less common option on divorce is pension attachment (previously known as earmarking). This involves some or all of the pension benefits due to one partner being ordered to be paid to the other.

There are a number of difficulties with this approach, including the fact that the second party has no control over their pension income – it only starts to be paid when the pension holder chooses to retire. Payments under a pension attachment order also stop when the pension holder dies, or if the recipient remarries. These factors, plus the fact that this approach does not involve a clean break financially, means that pension attachment is rare, with most people choosing pension sharing.

State Pensions

A basic State Pension cannot be shared on separation or divorce. It is possible to increase your own basic State Pension by using your former partner’s National Insurance contributions, without impacting the State Pension they receive. Any additional State Pension entitlements could be ordered by the court to be shared.

Property and Divorce

For people who own one, the family home is usually the biggest asset involved in any divorce or separation settlement. Arrangements regarding property can often be the biggest cause of stress between the parties, so getting advice on your options is key. We will ensure you fully understand your rights and the choices available to you.

Usually, people stop living in the same house on separation or divorce and choose from one of the following:

  • Sell the property and split the money
  • One party buys out the other, taking full ownership of the property
  • The property is transferred, leaving one party with full ownership, and the other with a right to a share of any sale proceeds at a later date
  • Both parties continue to legally own the property, although only one person remains living there
  • An order is made that the property will be sold at some future date (often when all dependent children leave home), with the proceeds of sale being divided at that point as the court decides

Mortgages on divorce or separation

If you have taken out a joint mortgage, both parties are responsible for repayments. This means the lender can require either one of you to make repayments if the other stops paying. In circumstances where the property is not sold and the mortgage paid off, mortgages are usually reviewed so that only one person is named as the borrower.

Companies and Divorce

Couples involved in running a business together will need to make arrangements following separation or divorce. It can be a complex process to determine the value of a business asset, and the court may well treat a family business as a source of income rather than an asset – this may mean that a party, who had little or no involvement in the business, may be entitled to a portion of its value.

Negotiations will need to take place to settle the value of the business assets, and how the company will be run in the future. Most people choose to make a clean break, with one partner exiting the company through a transfer or buy-back of their shares. We have experience dealing with these situations, and we will support you through each step of the process. 

Non-married couples

Under English law, cohabiting non-married couples do not have the same rights as married couples. The concept of a “common law” husband or wife is a myth. As such, if you choose not to get married or enter into a civil partnership, the most sensible choice is to enter into a cohabitation agreement, which sets out each person’s rights and obligations during the cohabitation and upon separation.

Where such an agreement exists, the process of separation is straight-forward. If there is no cohabitation agreement, there is often little that the family law courts can do if the couple cannot agree between themselves how to divide up their property. The distribution of disputed assets will often be determined purely on the basis on which the property is owned, so it is important to take this into consideration when purchasing items of significant value or importance.

If an unmarried couple with children separate, the law is designed to protect the welfare of the children, so, if the couple cannot agree the financial or living arrangements, the court can be asked to make a judgment.


Our podcast, The Legal Lounge, offers a number of useful episode about family law including this one on divorce and financial resolution. 

Contact The Family Law Team At Lanyon Bowdler

Lanyon Bowdler is a member of the Law Society Family Panel and accredited specialist with Resolution, a national organisation of family lawyers, so you can be sure our solicitors are experienced in all aspects of UK law.

Our divorce lawyers are approachable and professional, and will always adopt a balanced and practical approach to negotiations, minimising conflict and working to an acceptable outcome for you. Our aim is to achieve amicable resolutions swiftly, but if litigation is necessary we have the experience and know-how to deal with the courts effectively.

Please give us a call for a friendly, confidential, chat about how we can help support you when you or your family need legal advice and representation. Please contact a member of the team or complete our online enquiry form on the righthand side of this page.

By choosing Lanyon Bowdler for family law legal advice, you can rest assured that you have the best legal expertise on hand no matter what the situation. We are committed to providing exceptional levels of client care and will work closely and considerately with you to help find the best outcomes. Our Family Law Solicitors team has great experience in all areas of family law and family mediation.

We have offices in Shrewsbury, Bromyard, Conwy, Hereford, Ludlow, Oswestry and Telford, so are able to act for clients all over Shropshire, Herefordshire, Mid and North Wales and across the Midlands (including Wolverhampton & Birmingham). As a leading UK full-service law firm, we can represent you wherever you live in the UK.


Fantastic law firm - used Lanyon Bowdler for conveyancing & for legal advice - both solicitors I worked with were effective & professional. Law firm were fast & responsive to queries & clear pricing. Would recommend.   

- Samantha, Via Review Solicitors

Impressed by the efficiency and how they took control of our case. We don't have much of an understanding regarding solicitors and the legal system, but we were led through the whole process very well. We always felt we were in good hands.

- Mrs R Lutwyche, Shrewsbury

I was impressed with the efficiency and welcome of staff. Excellent office layout and service.  

- Mrs S James & Mr W Parkinson, Telford

A warm welcome from the receptionist. Extremely impressed by all that have helped us, peace of mind for our future.

- Mr M Court & Mrs A May, Shrewsbury

Always very efficient in dealing with the workload and advice given in divorce. Would highly recommend the service I received. 

- Mrs Suzanne Purvin

Knowledge and information given was accurate and realistic.

- Mrs Eleanor Margaret Howells, Hereford

Very efficient, pleasant and fully explained. I am well satisfied.

- Mr Stephen Turner, Oswestry

Friendly atmosphere and very professional attitude. 

- Mr Sidney Jolliffe, Oswestry

Case Studies

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