Divorce and Finance: FAQs Answered by Divorce Lawyers

According to the Ministry of Justice’s own statistics, in 2024 there were 45,564 applications for financial remedy in the family court in England and Wales, an increase of 3% from 2023. Financial remedy applications are made by separating parties going through the process of divorce or civil partnership dissolution who want a court to approve or decide how their assets and money should be divided. In this guide, our divorce lawyers will answer the most common questions about divorce and finance clearly and succinctly in a way that is easy to digest and apply to your own situation.  

What does ‘finance’ typically include in a divorce in the UK?

Divorce finance covers everything related to your money and property when you separate, including:

• the family home
• other properties
• savings and investments, pensions
• businesses and business assets
• debts such as loans or credit cards
• personal possessions of value (e.g. antiques), income
• maintenance and future financial needs
• the financial needs of children

Other financial matters may also need to be considered in a divorce financial settlement, including inheritances, trusts, compensation awards, redundancy payments, life insurance surrender value, endowment policies, and offshore assets. This list of marital assets is by no means exhaustive, there are many other forms of assets that may need to be taken into account when deciding on when it comes to divorce finances. 

It is always important that you and your ex-partner give full financial disclosure of your finances to each other. Doing so ensures that any agreement or court decision reached is based on accurate information. Any attempt to hide or simply not disclose certain assets can result in a less favourable outcome for the non-disclosing party.

How to sort out finance on divorce in the UK? 

You can reach an agreement on your divorce finances in one of three ways: by coming to an agreement between yourselves, through mediation, or by asking a family court judge to decide for you. The court option tends to become necessary when couples cannot reach an agreement on their finances (or part of their finances). Indeed, most couples try to agree outside court because it is quicker, cheaper and less stressful. 

If you can reach an agreement with your ex-partner, it is always recommended that you both ask the court to approve it by applying for a Consent Order. A court-issued Consent Order will ensure that your divorce financial agreement is legally binding and enforceable in a court of law if necessary. Also, without a Consent Order, both divorcing parties leave themselves open to financial claims in the future. This is where a Clean Break Order is so important. A Clean Break Order ends all financial ties so that neither person can make future claims against the other. A clean break divorce is not always suitable, but it can help provide closure and certainty where possible. 

No matter how you choose to deal with your divorce finances, it is important to understand the basic rules and to get legal advice. A divorce lawyer will explain your rights and responsibilities and those of your children and help you reach a fair outcome. 

How are assets split in a divorce?

When it comes to the question of ‘who gets what in a divorce’ in the UK, the court follows the principle of fairness. As such, there is no fixed formula such as a guaranteed 50/50 split. Marital assets can be split in many different ways. Each case is assessed individually, hence financial settlements can vary substantially. The judge will look at a wide range of factors, including your needs, your children’s needs, your income, your earning capacity, your property, your debts and your contributions to the marriage. 

When reaching a decision on your divorce finances, the courts start with an equal division. They will then adjust this up or down depending on the circumstances of the case in question. For example, one person may need more because they are the main carer for the children. Another person may need time to re-enter the workforce because they gave up their career to look after the household and children.  

For more details on asset division in divorce, see our articles:

Fair Divorce Settlement Examples in the UK

UK Divorce 70/30 or 80/20 Asset Split Explained

What assets cannot be split in a divorce in the UK?

Some assets are considered non-matrimonial. This means they fall outside the marriage and may not be split (although this is not always the case). Assets that may not be split in a divorce in the UK include:

• Property owned before the marriage
• Inheritances received by one person
• Gifts to one spouse
• Certain trust interests
• Assets that are clearly kept separate
• Limited companies

While the courts will tend to steer clear of non-matrimonial assets, they may be included in the ‘pot’ and divided if the marital assets simply are not enough to meet the needs of the parties. For example, if one spouse inherited a property before the marriage, this would usually be treated as a non-matrimonial asset and kept outside the settlement. However, the court can still bring it into the overall pot if the marital assets are not enough to meet both parties’ needs. With the high cost of housing, the sale of the family home may not produce enough equity for both people to rehouse themselves, especially if there are limited savings or other assets. In these cases, the inherited property may have to be considered so that both parties can secure suitable accommodation after the divorce. 

Check our article about matrimonial assets and non-matrimonial assets.

Who gets the house in a divorce?

In a divorce, who gets the house depends on the needs of the parties and the available finances. As such, when it comes to divorce and property, there is no automatic answer to who gets the marital home. The courts know that, in most cases, the marital home is often the largest asset, so they must be careful when making decisions such as who gets the house in a divorce.  

When deciding how to split up when you own a house together in the UK, the options usually include: 

• One person buying the other person’s share of the marital home
• A sale and division of the equity
• A transfer of equity from one party to another (this may require the acquiring party to take on the whole mortgage)
• A deferred sale where one person stays until a set time (e.g. when the children reach the age of 18 or they leave home)

Family court judges typically consider the housing needs of the children from the marriage first. They also look at the value of the property in the current market, the amount owing and equity in the property, the ability of the other party to buy a home, including their mortgage capacity, and whether the parties have other property they can sell or utilise. If the children are settled in the family home, it is most likely that the judge will ensure that they continue to remain. 

Do I have to sell my house in a divorce?

You do not always have to sell your house following a divorce or dissolution. The court will only order a sale if it is necessary and fair. This will depend on your circumstances, needs, and available assets. You may be able to keep your home by taking over the mortgage or buying the other person’s share. You can also look at ways to avoid selling your house in a divorce by: 

• Requesting a Mesher Order from the court – this will delay the sale of property to a point in the future (e.g. when your children reach the age of 18)
• Allowing one person to stay in the property until the children are older
• Agreeing to a buyout by one spouse
• A transfer of the property with a lump sum payment

Check our article about Selling Property Before Divorce Settlement in the UK

Can you get a divorce without a financial settlement in the UK?

Yes, you can get divorced without finalising your finances, but this leaves both of you open to future claims. Entering into a financial settlement gives certainty and protects you from claims years later. Another reason not to delay a financial settlement until after your Final Order has been issued is that it can be harder to come to an agreement on finances because: 

• Circumstances often change once the divorce is final, which can make each person less willing to compromise
• One or both parties may start new relationships or make new financial commitments, creating added pressure or conflict, and
• Assets can be spent, moved or reduced in value over time, making it harder to reach a fair outcome.

Does the length of marriage affect divorce settlement in the UK?

Yes, the length of your marriage can influence how a judge will decide your settlement, for example: 

• The courts tend to divide assets equally in longer marriages, while shorter marriages are more likely to focus on each person’s financial contributions and whether assets were acquired before or during the marriage
• Pre-marital assets are more likely to stay with the original owner after a short marriage, but in long marriages, these assets often become part of the overall pot, especially if both spouses benefited from them, and
• Settlements vary widely because the court considers all the circumstances, including children, income, health, earning capacity and how long the couple lived together before marriage.

Check our article about How Length of Marriage Effects Divorce Settlement in the UK

Can my ex-spouse claim my pension after divorce?

Yes, pensions are normally included in the matrimonial pot. This works both ways. Your ex-wife can claim your pension after divorce, and you can claim your husband’s pension after divorce. 

There are several different ways to share pensions following divorce or dissolution: 

• Pension sharing orders – transfers a percentage of one person’s pension into a separate pension pot for the other person, giving both parties independent retirement funds 
• Pension offsetting – allows one person to keep more of their pension in return for the other person receiving a larger share of different assets, such as property or savings, and 
• Pension attachment orders – directs a pension provider to pay a portion of the pension benefits, such as lump sums or income, to the ex-spouse when the pension becomes payable. 

Remember, pensions can be extremely valuable, so it is important to get legal and financial advice. Check our article on UK Divorce and Pension Split

How can I protect my assets from a divorce in the UK?

You can protect your assets from a divorce by understanding your rights early and taking practical steps. Some of the most common ways to protect assets from divorce include: 

• Entering into a prenuptial or postnuptial agreement
• Keeping clear financial records showing who owns what
• Keeping inherited property separate
• Independent legal advice
• Financial disclosure before marriage, where appropriate, and
• Placing assets into trust

If you adopt any of these strategies, it is vital to ensure they are done properly. This means ensuring that the contents of any agreements have been well considered and accurately captured, and the document is legally valid and signed. 

Am I entitled to spousal maintenance?

You may be entitled to spousal maintenance and support if you cannot meet your needs after the divorce and your ex-partner has the financial means to help. The court considers factors such as the duration of the marriage, relative incomes, who cares for children, and future earning capacity when deciding whether maintenance should be paid. It is also important to bear in mind that maintenance payments may stop if you remarry, begin receiving a pension, die or become financially independent, or if the payer no longer has the means to continue.  

Who pays for a divorce?

When it comes to who pays for a divorce, the filing party (applicant) normally pays the court fee for the divorce application, even when making a joint application. Beyond this, any other legal fees payable will depend on the case. Each party normally pays their own Solicitor fees when divorcing in the UK. Sometimes the court orders the other person to contribute if they behaved unreasonably, but this is rare. The court may also order cost-sharing or one party to pay the other’s costs only in rare cases of unreasonable conduct or misconduct.