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Secure your assets during a divorce – The importance of applying for a financial order

Many people mistakenly believe that a divorce itself finalises all financial arrangements between spouses.

However, without a financial order, your financial ties may remain open, leaving you or your former spouse able to make claims on each other’s assets even years down the line.

What is a financial order?

A financial order is a legally binding document that sets out the division of finances between you and your ex-spouse following divorce.

This order is approved by the court and can cover various financial aspects, such as property, pensions, savings, and maintenance.

There are several types of financial orders, including:

Clean break orders – These settle all financial ties between you and your former spouse, meaning no further claims can be made in the future.
Property adjustment orders – These detail how shared property will be divided or sold.
Pension sharing orders – These specify how pensions will be divided or transferred between spouses.

Each type of order serves a unique purpose, allowing you to tailor your financial agreement to suit your circumstances.

Why you should apply for a financial order

Simply finalising your divorce does not automatically settle financial matters between you and your ex-partner.

Without a financial order, either party could potentially make a claim on the other’s assets, even years after the divorce.

For instance, if one party comes into wealth through inheritance or business success, the other could legally pursue a share if there is no financial order in place.

A financial order provides peace of mind, ensuring that both parties’ finances are protected, and future claims cannot disrupt their lives.

It is especially vital for those with complex assets, property, or pensions to consider this step as part of the divorce process.

Failing to do so can leave one’s financial situation vulnerable to unforeseen claims and disputes.

How to apply for a financial order

Applying for a financial order involves several steps, and ideally, this should happen during or immediately after the divorce process.

Reaching an agreement

First, both parties must reach an agreement on how to divide their assets.

If you and your former spouse can agree, you may submit a consent order to the court, simplifying the process.

If an agreement is harder to reach, we can help mediate discussions to ensure a fair outcome.

Filing the financial order

Once an agreement is in place, we can draft the financial order, which both parties must approve.

The order is then submitted to the court for approval, ensuring it is legally binding.

If the agreement is contested, the court may need to intervene to make a fair decision.

Court approval

A judge reviews the proposed order, and if it meets all legal requirements, it becomes legally binding.

Once approved, the order serves as a final settlement of your financial ties, safeguarding each party’s financial future.

When should you apply for a financial order?

It is advisable to apply for a financial order during or immediately following divorce proceedings.

Waiting too long can expose you to financial risks, especially if there are assets such as property or pensions involved.

Early application can provide financial security, allowing both parties to move forward without the uncertainty of unresolved financial obligations.

Consequences of not having a financial order

If you finalise your divorce without a financial order, your finances remain legally linked to your ex-spouse.

This could mean that one party may be entitled to make a financial claim on the other’s assets even years after the divorce.

The lack of a financial order can also complicate future relationships, as unresolved financial ties can create challenges in managing finances with a new partner.

In many cases, courts have ruled in favour of ex-spouses who claim a share of post-divorce wealth due to the absence of a financial order, leading to drawn-out legal battles and unexpected financial loss.

From drafting and negotiating to filing the order with the court, our solicitors can assist with the process, offering peace of mind that your financial arrangements are fully resolved.

If you are considering a divorce or have already separated but lack a financial order, don’t leave your finances vulnerable.

Contact us today to learn more about how we can assist you in securing a financial order.

Stuart Daniel

Director – Head of Family Department

I qualified as a Solicitor in 2006 and now specialise in divorce, financial settlements, childcare arrangements and Pre Nuptial Agreements. I have many years’ experience as a private family lawyer having worked with two other local firms before returning to Mander Hadley, where I first undertook work experience during my university studies.