This article is taken from Merryn Somerset Webb’s free weekly personal finance email, Money Sense. Click here to sign up now: Money Sense
Divorce season is nearly upon us.
A few weeks now and we’ll all be cooped up at home with our families for a good week.
Lots of us will love every minute of domestic chaos. A large minority will start to think fondly of the peaceful times we spend in the office by December 27th.
But some of us will hit the New Year pretty certain that we don’t ever want to have to spend another Christmas with exactly the same lot of family ever again: more divorces are filed in early January than at any other time of the year.
This makes sense. These days we all work hard (often far too hard) so we don’t see enough of each other to keep our relationships working as they should: instead of talking problems out we can get away with ignoring them. Until Christmas. Then they surface with a vengence.
Worse, Christmas is expensive. Couples row more about money than about anything else so when the pricey presents start piling up it shouldn’t be much of a surprise that so do the rows about the bills.
The problem of course is that divorce takes financial problems and makes them worse. In marriage every burden is shared. In divorce every burden is doubled. And not just emotionally, but financially too.
One house becomes two houses, one phone bill, two phone bills and one set of insurances two sets of insurances. Suddenly there are two lifestyles to deal with. A total income that is sufficient to run one household rarely allows two households to survive in a similar style: when a marriage breaks down everyone usually has to suffer.
How to find a good solicitor
So, once you’ve decided that suffering is vital to your long term happiness, what next? First up is finding a solicitor. Just as you shouldn’t rush into marriage you shouldn’t rush into divorce: one of the main reasons to go to a solicitor and get proper professional advice is to slow things down a bit.
Most good solicitors will start off not by looking at a list of your assets to figure out who might get what but by asking if you can be reconciled. A great many couples are apparently shocked into sense just by visiting a solicitor’s office.
It is possible to file for divorce online – you input your details and you’re off – but to my mind you really shouldn’t be able to file for divorce on the spur of the moment: computers don’t stop to ask if you are sure, good solicitors do.
So how do you find a good solicitor? You don’t just need someone who is good at their job, you need someone you feel you can trust: if your divorce drags out you could be seeing them regularly for a couple of years.
The best way, as ever, is personal recommendations. If friends suggest someone good meet them – but don’t think you have to use them if you don’t think they’re quite right. Solicitors don’t take offence.
Otherwise you can ask at your local Citizens Advice Bureau or contact Resolution – First for Family Law, an association of matrimonial lawyers who work with a code of practice designed to help you come to a settlement in a positive and conciliatory, rather then overly litigious, way.
Remember: every angry letter and phonecall costs
And if you think you can be even the smallest bit amicable about your divorce you might want to consider something new – collaborative law. This is a system under which lawyers and their clients agree not to go to court to work out a settlement but to work it out themselves.
In court differences and arguments can become exaggerated, making the whole process even worse than it has to be. This system avoids the acrimony as much as possible by having the two sides meet at a round table with their lawyers and talk it out until they have a sensible settlement. Think Mick Jagger and Jerry Hall rather than War of the Roses. See the Collaborative Family Law Group for more on this common-sense route.
This article is taken from Merryn Somerset Webb’s free weekly personal finance email, Money Sense. Click here to sign up now: Money Sense
If you end up taking a non amicable route never stop thinking about the cost. When you are caught up in a legal battle instructing your solicitor to fire off letter after letter to your spouse it’s easy to forget that the cost of every letter will come out of the final pot of cash that you both have to live off.
As Imogen Clout points out in her book, Divorce, people in nasty divorces often talk about ‘fighting for their rights, or justice or the principle of the thing’, forgetting that the law is pretty clear on how assets should be divided and ‘that divorce law is not designed to deliver abstract redress or compensation’.
Solicitors charge for their time – every minute of their time. You will pay for every letter, every phone call and every meeting. You will even be charged for their travel time when they come to court. And their rate can be anything from £120 an hour plus VAT to a great deal more. That’s a cost to you of about £2.30 a minute. Big-money divorce can cost from £20,000 in fees. So only to consult them when you really need to. Don’t call them when you are angry (a therapist will be cheaper), just when you need legal advice.
And remember your lawyer probably doesn’t much care about how you perceive the rights and wrongs of your case; they just want to sort it out and get paid.
Fairness is an ‘elusive concept’
On the plus side this, in most cases this isn’t that hard. Divorce settlements used to be made on the basis of making sure the ‘reasonable requirements’ of the poorer partner (usually the wife) were taken into account, but now when there are more assets than needed for just this (when there is a ‘surplus’) the ideas of ‘fairness’ and equality have taken over.
Even if there has been one main breadwinner in a family each party is still entitled to maintain their living standards post-divorce as much as possible: domestic contributions are considered as valuable to a family as the role of a breadwinner.
Property is now usually divided fifty-fifty, for example. There is also now scope for women who have given up careers to be stay-at-home mothers to be compensated for this in the settlement.
There were howls of protest from men all over the country in 2006 when Julia Macfarlane was awarded £250,000 a year out of her husband’s earnings of £750,000. But was that really too much? Macfarlane had given up her career to look after her husband and her children (she was out-earning him when she stopped work) but after a decade-long break can hardly be expected to pick up where she left off. By becoming a wife and mother she gave up a huge earning potential. So why should she, because she stopped work to look after children, have a lower standard of living than her ex-husband?
It’s a vexed question. Some say she was entitled to everything she got: if you are dumped after such a long time you are ‘due a lot of back pay’ as one ex-wife put it in Style magazine. But some say that giving up work was her choice (clearly the Macfarlane family could afford childcare) and that having less money now is simply the price she has to pay for making that choice. Fairness, as law lord Lord Nicholls of Birkenhead said in his judgement on the case, is ‘an elusive concept’.
The basics of divorce settlements
However for most of us what we think about the Macfarlane case or indeed any of the high-profile divorce cases that hit the papers is by the by: the assets of most married households, when divided, simply aren’t enough to keep two households well, let alone to allow arguments about the surplus. Settlements are less about who gets the house in Harbour Island and more about how assets can be divided so both parties can actually survive.
The average divorcing couple in 2006 had only £165,000 in assets to divide between them – hardly enough for both to be even satisfactorily housed post-divorce.
Anyway, the courts have a fairly standard way of sorting out financial settlements. They will take into account the needs of each part of the family, the length of the marriage, your ages and the contributions each of you have made (making no differentiation between financial contributions and household contributions) and divide all your assets accordingly, sorting out everyone’s basic needs first and then divvying up the surplus if there is one.
This is all traumatic but it isn’t that complicated: there tend to be set answers depending on how long you have been married, whether you have children and what each party brought to the marriage and contributed during it.
For basic information on all this visit Divorce.co.uk which offers a good (and free!) round up of the legal process and potential pitfalls as well as some help with the emotional issues that come with divorce.
This article is taken from Merryn Somerset Webb’s free weekly personal finance email, Money Sense. Click here to sign up now: Money Sense