Divorce Financial Settlement – What am I entitled to?

What Is a Divorce Financial Settlement?

A divorce financial settlement is a legally binding agreement that finalises financial arrangements between spouses, covering the division of marital assets, pensions, debts, spousal maintenance, and child arrangements.

This settlement, formalised by a Consent Order and approved by the court, ensures fair distribution of assets on divorce by considering each party’s income, needs, financial contributions, and future earning capacity.

Going through a divorce often raises urgent questions about how your property is divided, what happens to financial assets, and whether you’re entitled to make a financial claim.

The division of assets is a key part of the divorce process, and the financial settlement you agree upon will depend on factors like the length of the marriage, your respective financial contributions, and your current and future financial circumstances.

What am I entitled to in a divorce or separation?

In a divorce or separation, you are entitled to a fair division of your current and future financial assets, including the family home, pensions, and savings. The financial settlement in divorce is not automatically 50/50 and will depend on your needs, your financial contributions, and any ongoing financial commitments.

The court may become involved if you and your ex‑partner cannot agree on a financial settlement, but most financial disputes can be resolved through negotiation or mediation before going to court.

Neither person is entitled to walk away with everything in a divorce. Financial settlements in the UK aim to achieve a fair outcome for both parties, regardless of who earns more or who is in a weaker financial position.

Any agreement should reflect the needs of both parties and can be made legally binding through the court as part of the wider settlement process.

Are you struggling to calculate who gets what in a divorce settlement? Use our divorce settlement calculator to get a customised report on divorce asset division.

How is a financial settlement calculated in a divorce?

To calculate ‘fairness’ in financial settlements, the court has a very wide discretion and refers to the principles set out in Section 25 of the Matrimonial Causes Act 1973.

Here are the factors considered by the Courts in respect of a financial settlement in a divorce:

1. Financial Situation: The income, earning capacity, property and other financial resources that each of the parties to the marriage has or is likely to have in the foreseeable future.
2. The Welfare of the Children: Their needs come first, including housing and education. Couples are encouraged to prioritise the children in any negotiation.
3. Duration of Marriage: Longer marriages often result in more equal divisions. The length of marriage typically plays a big role in who gets what.
4. Financial Resources and Needs: It considers what each person needs to pay for and any financial obligations they have now or might have soon. The financial needs of both parties are paramount to the court.
5. Previous Lifestyle: The standard of living before divorce the family had should be maintained where possible.
6. The Health of Each Party: Considerations for any physical or mental health issues either party has.
7. Contributions to the Family: Contributions made by each spouse are considered. Contributions are not only monetary related, they can include taking care of the home or the family.

If you’re struggling to agree on terms or understand what’s fair, read the following guide. Fair examples of UK divorce settlement agreements.

What can I expect from a typical UK divorce settlement?

In most cases, a 50/50 split is the starting point for dividing assets, but it’s rarely the final outcome. A fair financial settlement on divorce depends on your specific circumstances, including income, property, pensions, childcare responsibilities, and your overall financial position.

A typical financial divorce settlement may include:

• A share of your partner’s pension
• A lump sum from joint savings, investments, or income-generating assets
• A share of the proceeds from selling the family home
• Spousal maintenance to help cover ongoing living costs
• A share of life insurance policy payouts or their cash value

When you apply to the court for a financial settlement, they will assess what’s fair based on both parties’ needs, not just what was earned or contributed financially. UK divorce and financial law does not favour the higher earner or penalise someone who stayed at home to raise children.

We’ve helped over 40,000 couples reach a fair settlement, and many are surprised to learn that the final division of assets rarely matches the assumed 50/50 split. Whether you’re the homemaker or the breadwinner, the court aims to deliver a fair and realistic financial outcome.

Because no two situations are the same, we always recommend seeking professional advice to understand what a fair financial settlement might look like in your case. A strong agreement not only protects you now but can prevent future claims after the divorce has been finalised.

Four ways to negotiate a financial settlement on divorce

1) Negotiate between yourselves

This is the most straightforward approach where you and your ex-partner sit down and agree on the terms of your settlement without any outside assistance.

This can be the least costly option and gives you full control over the outcome, but it requires a good level of communication and cooperation.

2) Mediation:

If negotiating directly is difficult, you can use a mediator. In mediation, a neutral third party facilitates discussions between you and your spouse to help reach a mutually acceptable agreement.

The mediator doesn’t make decisions but assists in communication and problem-solving. Mediation can be less adversarial and costly compared to litigation, and it often promotes amicable resolutions.

3) Collaborative Law:

This is where each person hires their own lawyer but instead of conducting negotiations between you and your partner through letters or phone calls, you meet together to work things out face-to-face.

4) Solicitor-Led Negotiation:

You can have solicitors negotiate on your behalf. This can be beneficial if the relationship between you and your partner is particularly acrimonious or if your financial affairs are complex.

Can I get a divorce without a financial settlement?

Yes, you can get a divorce without having the court approve a financial agreement. In theory, you can apply for a divorce in your 20’s and start financial settlement proceedings in your 50’s unless you re-marry.

Whilst it is entirely possible to get a divorce or dissolve a civil partnership without reaching a financial agreement, it is generally not recommended by family law professionals.

Most people are not aware that legally ending the marriage or civil partnership does not prevent either party from making financial claims in the future, even years after the divorce.

Read more: The Dangers of Divorce Without a Divorce Settlement

There have been high-profile cases where former spouses have returned to court after being divorced for over 20 years and being successful in receiving financial provisions because they didn’t get a financial order approved by the court.

How are money and assets split in a divorce?

Before looking at how money & assets may be split in a divorce settlement, you need to know the difference between assets.

Matrimonial assets

Assets you have built up or acquired during marriage are known as matrimonial assets.

Matrimonial assets typically include:

• The family home and other property
• Pensions
• Savings (joint bank accounts)
• Debts
• Vehicles

These assets will always be added to the overall ‘pot’ and must be split fairly. Bear in mind that fair doesn’t necessarily mean 50/50 of everything.

Non-matrimonial assets

Non-matrimonial assets are financial assets acquired before getting married, for example.

Assets that can be considered ‘non-matrimonial’ include:

• Gifts
• Personal belongings (vehicles, watches, furniture, etc)
• Businesses
• Property owned before marriage
• Investments
• Inheritance

Non-matrimonial assets are usually treated differently from matrimonial assets, however, they aren’t necessarily excluded from a divorce settlement.

For example, if an inheritance has been used during the marriage to purchase a car or house, this asset would now be classed as a marital asset.

There are various ways of splitting your assets, such as lump-sum payments to one spouse, offsetting a pension against other assets of the same value, and agreements on maintenance payments for both a spouse and children.

How does the court assess matrimonial vs non-matrimonial assets in a divorce?

Is there a time limit on reaching a financial settlement on divorce?

There is no specific time limit set by law for reaching a financial settlement after divorce.

The timeframe for reaching a settlement can vary depending on the complexity of the case and the willingness of both parties to cooperate and negotiate.

There is no time limit on claiming against an ex-spouse after divorce, which is why it’s vital to ask the court to approve a legally binding financial order alongside your divorce proceedings.

If the court hasn’t dismissed a spouse’s financial claims by approving a court order, either party can make a claim in the future, providing that they have not remarried.

How much does a financial settlement cost?

The cost of a financial settlement depends on how it’s reached and the complexity of the case, but they can range from £300 to £1,500 for a consent order, £100 to £200 per mediation session, or £10,000+ if court proceedings are involved.

Factors that affect the cost of a financial settlement are:

• How the settlement is reached: Agreements through mediation or consent orders cost less than court proceedings.
• Legal representation: Solicitor fees depend on experience and the amount of work required.
• Complexity of finances: Dividing property, pensions, businesses, or significant debts increases costs.
• Disputes: Disagreements lead to higher legal fees and extended court involvement.
• Arrangements for children: Child maintenance, school fees, and other needs may add expenses.

How Divorce-Online Can Help

Reaching a divorce settlement is never easy. Legal advice for couples with wealth is always advised.

If you’re handling your own divorce or plan to in the near future, you should consider our online consent order services.

Reaching an agreement is part of the process, but without having it professionally drawn up into a legal document, it, unfortunately, means nothing.

Please do not attempt to do this yourself. If you’re worried about legal costs, our low-cost services from £399 can help you save thousands in legal fees whilst providing you with certainty.