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What is the process of reaching a settlement?
The process of reaching a financial settlement can be complex and is often an emotionally charged discussion.
The first step is to understand exactly what is in the marital pot for division, which will be done through financial disclosure. It is recommended that you seek legal and, if necessary, professional financial advice.
There are a number of routes that you can take in order to reach a financial settlement. You may decide to directly discuss your options and the division with your spouse and come to a conclusion between yourselves. This is sometimes known as a DIY divorce. However, it is important that you are aware of the potential risks of following this route. Without legal advice, you may miss important elements that should be included, like pensions, which can have long-term consequences.
What is the process of reaching a settlement?
The process of reaching a financial settlement can be complex and is often an emotionally charged discussion.
The first step is to understand exactly what is in the marital pot for division, which will be done through financial disclosure. It is recommended that you seek legal and, if necessary, professional financial advice.
There are a number of routes that you can take in order to reach a financial settlement. You may decide to directly discuss your options and the division with your spouse and come to a conclusion between yourselves. This is sometimes known as a DIY divorce. However, it is important that you are aware of the potential risks of following this route. Without legal advice, you may miss important elements that should be included, like pensions, which can have long-term consequences.
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Other options for the process of reaching a financial settlement:
• Mediation
• Solicitors led negotiations
• Court proceedingsWhich path you choose will depend on the nature of your divorce and how readily you and your ex-spouse can come to agreements on financial matters. For example, you may be able to settle after a few mediation sessions, or if your divorce is more acrimonious, you may need court intervention.
Ensuring you seek the advice of a family lawyer, and they draft the consent order can save time and money as a solicitor will be able to advise on what a court will and will not accept in a financial agreement.
What is a consent order?
A consent order is the official document issued by the court that states the details of your financial settlement.
It will contain how assets are to be divided, any maintenance payments that will be made between parties going forward, and any deadlines that need to be imposed.
The consent order legally breaks all financial ties between you and your ex-spouse.
Without a consent order, you are still financially connected.
If you choose to not get a consent order, it may be worth getting a Separation Agreement. This is a legal document, but it is not a court order.
Without either of these documents, you are potentially putting your financial future at risk and your ex-spouse can make claims on your money down the line.
What is a clean break?
A clean break is a term sometimes thrown around in the divorce world. Often it is intended to mean when a couple has had an amicable breakup and are able to just move on without disagreements.
However, a ‘clean break’ is a technical term used in divorce proceedings referring to a clean break order. Like a consent order, this is given by the court and ensures that all financial ties between a divorced couple are severed.
It can be tricky in divorce to decide whether to opt for a clean break, or for ongoing spousal or child maintenance. A clean break is for those couples who wish to cut their financial ties as quickly as possible upon divorce.
There are two main options for a clean break:
- The order includes all capital, pension and other income claims,
- The order includes all capital, property etc but leaves claims open on income. This is the option for those couples who will see ongoing spousal maintenance payments. This is a delayed or deferred clean break order.
If you and your ex-spouse decide that one of you should pay the other some form of income, this should be agreed upon in the financial settlement. You will need to agree how much money should be paid, when, and for how long. There is often a cut-off point, for example when the eldest child reaches 18.
At this point, the clean break order would be enacted and you and your ex-spouse would be financially independent of one another.
Why do I need a consent order?
A consent order is very important. You and your spouse may have gone through the official process of divorce and obtained a final order, legally ending your marriage, but this does not end your financial ties.
A consent order is made when you and your ex-spouse have come to an agreement about your finances. Without this, you are still financially connected, and your spouse can make claims on your income, property, any inheritances, pensions etc in the future.
A consent order officially severs the financial ties. Whilst it is not a legal requirement in order to get divorced, without one, you potentially leave yourself vulnerable.
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