It is one of the most common and costly misunderstandings in family law: people assume that once the divorce comes through, the money is also sorted at the same time. It is not. The divorce and the separation of finances are two separate processes, and dealing with financial matters t is often the more important of the two.
Why the divorce does not settle the money
A final order ends your marriage, but it says nothing about who keeps the house, how savings are divided, or what happens to pensions. Those need a separate financial agreement and here is the risk of leaving it: without a formal financial order, your ex-spouse could bring a financial claim against you years after the divorce, even after you have rebuilt your life.
Does a divorce automatically divide your finances?
No. A divorce only ends the marriage, it does not divide money or property. To make a financial split legally binding, you need a consent order, sealed by the court. Without one, either spouse could make a financial claim against the other years later.
What is a consent order?
A consent order is the document that turns any financial agreement into something legally binding. Once you and your spouse agree on how best to divide everything, a solicitor drafts an application for a financial consent order and statement of information for a consent order and the draft financial consent order itself and if approved of, the court seals it which makes then the order at that stage legally binding. You can apply for it after your conditional order is granted but not before and it is the only way to draw a line under the financial side of your marriage.
How are assets divided?
There is no fixed formula. The starting point is fairness, and the court looks at a range of factors, for example, the length of the marriage, each person’s financial and other needs and earning capacity, and above all, the welfare of any children. Assets that are typically considered include:
- The family home and any other property
- Savings, investments and business interests
- Pensions – often overlooked, but frequently one of the largest assets in a marriage
Pensions deserve particular attention. Many people give up valuable pension rights simply because they do not realise what they are worth. After any family home or other bricks and mortar property, often a pension is the next largest asset to take into consideration. A fair settlement looks at the whole picture, not just the house and before reaching any agreement, it is good practice for the parties to share financial information with one another so that an agreement can hopefully be reached amicably.
The clean break settlement
Where possible, a “clean break” settlement ends all financial ties between you, so neither can claim against the other in the future. It is not right for every situation, particularly where there are children or large differences in income, but where it is achievable it offers real peace of mind.
Getting this right early also affects your overall timeline, see how long divorce takes. For the wider process, start with our guide to how no-fault divorce works.
Protect your financial future
A fair settlement, properly documented, is worth getting right. Speak to our team for a free 30-minute consultation. Call 0191 269 6871.
Alternatively, take a look at our Divorce, separation and civil partnerships service to learn more.
This is a general guide, not legal or financial advice for your specific circumstances.
FAQs
Does my divorce automatically divide our money and property?
No. A final order ends the marriage but says nothing about the house, savings, or pensions. Those need a separate financial agreement made legally binding through a consent order sealed by the court.
What happens if I divorce without a financial order?
You leave yourself exposed. Without a formal financial order, your ex-spouse could bring a financial claim against you years later, even after you have rebuilt your life. A sealed consent order is the only way to draw a firm line under the financial side of your marriage.
When can I apply for a consent order?
You can apply once your conditional order has been granted. In practice, your solicitor drafts the order after you and your spouse have agreed how to divide everything, and the court then seals it to make the agreement binding.
How does the court decide who gets what?
There is no fixed formula. The starting point is fairness, and the court weighs factors such as the length of the marriage, each person’s needs and earning capacity, and above all the welfare of any children. The family home, savings, investments, business interests, and pensions are all considered.
What is a clean break, and is it right for me?
A clean break settlement ends all financial ties so neither of you can claim against the other in future. It offers real peace of mind but is not suitable for every situation, particularly where there are children or a large difference in incomes. We can advise whether it is achievable in your case.