What is a financial settlement?
A financial settlement is essentially who gets what, when a couple separate and involves decisions about how their assets should be divided. The separating couple can be married partners, civil partners or they can be partners who have lived together. When there is a decision to separate inevitably there will be a need to look at how their assets should be shared. What is a reasonable settlement to meet the children’s needs and to enable both to move on into the next stage of their lives?
How to reach a financial settlement
There are a number of ways to reach a financial settlement. There is a misconception that being involved in decisions about money and finances has to be time of argument and distress. Settlements can be agreed by a couple themselves or with advice and help from a solicitor, or by a couple engaging in mediation or a collaborative process. A settlement can be formalised into a legally binding Court order without the need for anyone to set foot inside a Court building.
There are occasions when it is not possible to reach agreement for a number of reasons. When this occurs an application can be made to Court to resolve any area of dispute. Just because an application has been made, does not prevent a couple from reaching agreement. However the Court can decide what should happen with the assets and make what is considered to be a reasonable order.
What sort of orders are there?
The payment of a regular sum of money by one to the other, usually weekly or monthly, either for their benefit or for the benefit of the children. This is known as a periodical payments order or put more simply, maintenance.
Having decided that there is entitlement to maintenance the Court can take steps in advance to ensure the money will actually be paid. This can be done by a secured periodical payments order.
The payment of a specific sum of money. This is known as a lump sum order. This order can be made by way of compensation for an interest in a property, the house contents, savings and investments.
The transferring of property from one to the other, or adjusting ownership of property between the couple or giving one of them a specific interest in property. This is most commonly used in relation to the family home although there are all sorts of property which can be made subject to this order for example, holiday home, car or shares. This is known as a property adjustment order.
After the family home, one of the other most valuable assets can be a pension and the Court now has a number of ways in which to deal with those. These are known as pension sharing orders but can also include pension off-setting, or orders for pension attachment or ear marking.