How to Protect Your Family’s Assets in a Divorce

Divorce can be a challenging time, especially when it comes to financial matters and protecting your family’s assets. Here we seek to explore key strategies and considerations to safeguard your wealth during a divorce. Whether it is through full financial disclosure, understanding the division of assets or utilising legal agreements like prenuptial and postnuptial agreements, there are proactive steps you can take to secure your family’s financial future.

Full and Frank Financial Disclosure

When going through financial remedy proceedings upon a divorce, both parties need to provide full and frank financial disclosure. This requirement applies whether you settle matters through the court or alternative dispute resolution methods. It entails disclosing all assets, including those held jointly or in individual names. However, disclosure does not automatically mean that assets are up for division. The court considers various factors, such as the needs of the children, when determining the division of assets.

Protecting Assets Acquired Prior to Marriage

Assets brought into a marriage can be protected to some extent, depending on the circumstances. Generally, the longer a couple has been married, the less likely it is that pre-marital assets will be treated separately. After a certain duration, typically 12-15 years, these assets may be considered part of the matrimonial assets, certainly if they have been mixed with matrimonial assets. However, in shorter marriages, assets brought into the marriage may well be retained by the respective parties.

Safeguarding Pensions

Pensions are another significant consideration during a divorce. While it may seem straightforward to separate pre-relationship pension accruals, the process can be complex. Valuing the portion accrued before the marriage requires careful assessment, often involving actuaries. For instance, if a spouse has held a pension for 16 years and the marriage lasted ten years, the court may agree to divide the pension’s value over the 10-year period.

Preserving Inheritances

Inheritances are generally treated differently from other assets in divorce cases. English law recognises the intention of the deceased to benefit specific individuals. Inheritances can be ring-fenced and protected if certain conditions are met.

If a third party, such as parents or others, are concerned as to their assets being lost in Financial Remedy proceedings upon a Divorce, they may be able to intervene within the proceedings to seek their interest in the said assets. This must be done with careful consideration as fairly strict costs consequences may follow the decision of the Court.

Legal Agreements – Prenuptial and Postnuptial Agreements

Prenuptial and postnuptial agreements offer effective ways to protect family wealth during divorce. A prenuptial agreement, entered into before marriage, outlines how assets will be divided in the event of divorce. It can help preserve family wealth and contributions made by parents. While not strictly legally binding, prenuptial agreements are given varying weight by the Court if both parties freely enter into them and they do not result in an unfair outcome. Postnuptial agreements serve a similar purpose but can be entered into after marriage. They are beneficial for couples who did not create a prenuptial agreement before getting married or when significant financial changes occur during the marriage. The Importance of Specialist advice cannot be underestimated in such circumstances.

Legal Advice

DIY divorces and incomplete legal advice can lead to costly litigation down the line. Consulting with a specialist family law solicitor who can provide tailored guidance based on your specific circumstances is crucial. They can draft consent orders, which outline the financial agreement between the parties, ensuring a “clean break” provision and minimising the risk of future financial claims. They can also advise on your legal rights, the legal process and tactics to be employed should the matter progress by way of Court proceedings.

If you need further support, talk to one of our divorce specialists today at +44 (0)203 196 7822, over email at enquiries@garricklaw.com or visit our Criminal Appeals page for more information.