A Brief Guide To Divorce Financial Settlements


Divorce can be a complex and emotionally charged process, and confusion and disputes regarding the division of matrimonial property and assets are incredibly common. In this guide, we demystify the divorce financial settlement process by answering some of the most common questions asked by our clients.

What are the first steps in negotiating a financial settlement?

After instructing a Family Law Solicitor, you and your spouse must make a full and frank financial disclosure. This involves revealing all assets, income, liabilities, and expenses. This information forms the basis for any future negotiations or court decisions.

If you have evidence that your spouse is hiding or disposing of assets so they do not become part of the financial settlement, you must inform your Solicitor immediately. They can apply to the Court for a Freezing Order that, if granted, can prevent your spouse and third parties from dealing with or disposing of assets whilst Court proceedings are underway. A forensic accountant can also be instructed to locate assets that may be hidden behind complex corporate structures and/or trusts.

Once disclosure has been made, your Solicitor will ascertain what you want to achieve from the financial settlement. If possible, it is always better for couples to agree a financial settlement between themselves rather than have the Court impose a Financial Order. However, in some cases, especially where there is a history of abuse within the relationship or one partner is controlling, applying for a Financial Order is the only way to reach a settlement.

What are the factors under section 25 Matrimonial Causes Act 1973?

Section 25 Overview Section 25 of the Matrimonial Causes Act 1973 sets out the factors that must be considered by the Court when making financial orders in divorce cases. These factors include:

• the income, earning capacity, property, and other financial resources each party has access to now and in the near future

• the financial needs, obligations, and responsibilities of each of the parties now and in the near future

• the standard of living enjoyed by the family before the breakdown of the marriage

• the age of each party to the marriage and the duration of the marriage

• any physical or mental disability of either of the parties to the marriage

• the contributions that each of the parties has made or is likely in the near future concerning caring for any children of the marriage

• the conduct of each of the parties, if that conduct is such that it would, in the opinion of the court, be inequitable to disregard it

• the value of any benefit one party will fail to acquire due to the divorce

While all Section 25 factors are considered, their weight in each case may vary based on individual circumstances. The Court aims to achieve fairness, and thus, no single factor takes precedence over others.

What if my spouse and I disagree over the divorce financial settlement?

Divorce proceedings can often be accompanied by disputes, particularly when it comes to financial settlements. The following procedures are used to reach a resolution, with going to the Family Court seen as a last resort.

Round table meeting/negotiation

During a round table negotiation, both spouses, along with their Solicitors, meet face-to-face to discuss and negotiate the terms of their divorce settlement. This approach encourages open communication and cooperation.


Before resorting to court proceedings, divorcing couples are encouraged to engage in mediation. Mediation involves a neutral third-party facilitating discussions between the spouses to help them reach an amicable agreement.

Unless you are exempt, you and your spouse will need to attend a Mediation Information and Assessment Meeting (MIAM) before you can file proceedings in court.

Court Proceedings

If mediation and negotiation fail to yield an agreement, the dispute may proceed to court. Here, a judge will consider various factors to determine a fair financial settlement, guided primarily by Section 25 of the Matrimonial Causes Act 1973.

The Court can issue various financial orders, including lump-sum orders, property adjustment orders, pension sharing orders, and spousal maintenance orders. The type of order issued depends on the specific circumstances of the case.

What is a Consent Order?

If you and your spouse have agreed between yourselves how your finances will be divided, you can apply to the Court for a Consent Order. This protects you should your spouse change their mind about any financial arrangements you have mutually agreed to. In addition, getting a Consent Order protects any future financial gain and/or assets such as pensions, inheritance, or earnings from being claimed by your ex-partner.

In conclusion

Getting divorced involves separating two lives that in some cases have been intertwined for decades. An experienced Divorce Law Solicitor will do everything possible to help you and your spouse reach a financial settlement between yourselves, saving the cost and stress of court proceedings. However, sometimes this is not possible. If going to court proves inevitable, you need a talented, strategic legal team who can protect your best interests.

If you have any questions regarding this article, please call us on 0300 3732424.