Financial support after divorce
Posted: Tuesday January 5 2021
By: Rachel Roberts
After almost 2 decades or practicing, I can say that January generally is a busier month for new enquiries, but there are other peaks throughout the year, often after holidays, where people have perhaps tried unsuccessfully to save their marriage.
Financial support after divorce
The new year often brings about a desire in people to make changes to their lives, and for some people, that can mean bringing an end to their marriage. Most of us have heard of the so called “Divorce Day”, being the first Monday back after the Christmas break, when the press like to report each year that divorce solicitors experience a surge in enquiries.
Most people want to understand the financial implications of getting divorced when they first take advice, and whether they will be able to manage financially. That can include how any capital will be divided, which is not the subject of this blog, but often, the concern is around ongoing financial support after divorce.
A clean break
Often people hope to achieve is a complete clean break from their former spouse, both emotionally and financially. In an ideal world, at least where there are no children involved, both parties would walk away with no remaining ties between them. Legally, the phrase “clean break” means just that, so that neither party can bring any future financial claims against the other, once any assets have been divided between them.
In other cases, however, that cannot be achieved, and one party might seek to claim spousal maintenance from their former spouse. The legal term is “periodical payments”.
When will the court order spousal maintenance?
There are a few key things to understand here:
- The court has a duty to consider whether a clean break can be imposed. The test is whether the parties can adjust without undue hardship;
- The court has a discretion in deciding what orders to make upon divorce. This means the outcome is not guaranteed;
- The court can order spousal maintenance for life, for a fixed term and, where there is sufficient capital, can order it to be paid up front.
- The court has various factors that it must consider, and insofar as maintenance is concerned, the most relevant ones are likely to be age, length of marriage, any children, needs, standard of living during the marriage and earning capacity.
What does that mean in practice?
It is safe to say that the court’s approach to maintenance has changed in recent years. When I started practicing, it was common for (usually) wives to get orders for the remainder of their lives. Now such orders are extremely rare, and it is hard to persuade courts to make long term orders. There is an expectation that both parties will do their best to generate their own income, and the court will not only look at what someone is earning but also what they can be expected to realistically earn, perhaps with some retraining or given a period to adjust.
There is no automatic right to share in someone’s income moving forward, so even if there is a discrepancy between the spouses’ income resources, that does not mean the court will look to equalise the income positions. Rather, the financially weaker party will need to show:
- That they cannot meet their needs from their own resources; and
- That their former spouse can afford to provide the additional support they need.
Every case is individual, and careful consideration needs to be given to both parties’ needs but it is also necessary to look at the other aspects of a settlement. For example, if one party is getting more of the equity in the family home because they have a lower mortgage capacity, the other party may have greater outgoings on mortgage payments, so the whole picture has to be considered. Ultimately, we are looking to achieve fairness and meet both parties’ needs.
What about child maintenance?
Unlike spousal maintenance, payment of child maintenance is a statutory obligation and the court can only order it where parties agree the sum. It is otherwise a matter for the Child Maintenance Service, but any payments for child maintenance would obviously need to be considered when look both at the receiving person’s needs and the affordability for spousal maintenance.
What happens if circumstances change?
In the current climate, where many people are under threat of redundancy and job losses, people are naturally concerned about what happens where they are reliant on their former spouse for ongoing maintenance. Put simply, any maintenance order can be varied if circumstances change, and that can be either of the payer or the payee. It is worth noting that if you are receiving maintenance and re marry, it will automatically come to an end. If you cohabit it may.
Maintenance is generally paid out of income, and therefore no guarantee can be made for future payments. Whilst this can be disconcerting, it is obviously essential that payments can be varied to reflect changes that are not foreseeable when the order is first made.
Early advice is key
In summary, its fair to say the law around spousal maintenance is complex, and if you are considering separating and concerned about how you will manage, it is worth taking early advice.
Read our latest lifestyle articles here including lots more from Rachel Roberts from Stowe Family Law.
# Financial support after divorce