If you are going through a divorce, you may be worried about how it will affect your financial situation in the future. Financial settlement is an important part of divorce proceedings, and reaching an agreement may be complicated.
When all of the evidence has been submitted by both parties, and the courts make a decision about the way assets and income will be divided, the financial settlement is usually the final part of the process and it is often a relief to reach this stage.
How Divorce Can Affect Your Financial Situation:
There are several factors that will be considered by the courts when making a financial settlement, and these include:
- Children. The custody arrangements made for any children will be considered by the courts, since this will be an important factor in the future living arrangements of each party. If the children will live with one parent full time and visit with the other, for example, the resident parent will be seen to require a larger property to accommodate them. The non-resident parent will usually be required to contribute towards the cost of housing and essentials for the children.
- Where did money come from? The courts will carefully assess where assets and wealth originated, and if one party owned these before the marriage, this will be reflected in the settlement. Where wealth has been acquired during the marriage, this will usually be divided between the parties, taking the other factors into account.
- Expenses. Each party will need to provide a personal budget, detailing income and expenses, including all childcare, housing costs and commitments. This must be comprehensive and detailed, and will be a very important part of the financial settlement process.
- Length of marriage. The length of the marriage will be considered when financial settlement is being decided, since the amounts agreed will usually reflect this.
- Future earning capacity. The future earning capacity of each party is very important to this process, since a larger financial settlement or maintenance agreement will need to be put in place if one party is unable to earn in the future, for example due to parenting young children or to a disability. If both parties are judged capable of earning their future living costs, the settlement is likely to reflect this.
Maintenance Agreement Or Lump Sum?
If it is possible to finalise a financial settlement at once, this may be done by the payment of a lump sum from one party to another, or to both parties from the sale of a property, for instance. However, if ongoing support is necessary, or if it is not possible to access capital immediately, an arrangement to pay regular maintenance may be made. These payments will usually continue until a jointly owned property is sold, until the party in receipt of the payments remarries, or until another milestone is reached, such as retirement or the youngest child leaving home.
Find Family Law Solicitors in Cork
If you are considering a divorce, you can talk to our family law specialists at Irwin, Kilcullen & Co Solicitors. Simply contact us online or call us today on +021 4270934 to see how we can help.