Cash Clinic: Financial fears after marriage comes to an end

Q AFTER 15 years of marriage, my wife and I have decided to go our separate ways. I am very concerned about the financial implications.

Over the past couple of years, due to the recession, our assets, including our family home, savings and pension are not worth what they once were. Despite agreeing that our marriage is over, I am worried about the financial impact of separating and the worry that our home will not sell, or will have to be sold well below the amount that I paid for it. Any advice you can offer on how we deal with this situation financially would be much appreciated.

JM, Kilmarnock

A Going through a divorce can often be an emotionally challenging and stressful time. However, the fact that your assets have depreciated should not necessarily concern you in relation to separation. The most important principle in financial separation is that the net value of the matrimonial property should be shared fairly between the parties to the marriage.

Broadly speaking, matrimonial assets are split equally according to their value at "the relevant date" (ie: the date you separated).

Any assets acquired before marriage or after separation or acquired at any time by way of gift or succession from a third party may not be deemed matrimonial property. This includes contributions that you made to savings or pensions.

In your situation, it sounds as though the financial sum owed to your wife will be very much less than it may have been four or five years ago. Further, any debts you have outstanding at the relevant date are deducted for the purposes of valuing the property.

The court will be guided by a series of principles to ensure the property is divided fairly. For example, if any party is likely to suffer financial hardship as a result of a divorce, they shall be awarded such financial provision as is reasonable to relieve that hardship.

Likewise, if a party has derived economic advantage or been dependent on financial support from the marriage, this may all be taken into account. Any financial settlement must be made in accordance with these principles of basic fairness and also be deemed reasonable having regard to your and your wife's present and foreseeable resources.

It is important you and your wife take separate legal advice. While you may be concerned about the timing of the sale of your matrimonial home, it is important that you discuss this with your solicitor.

Financial agreements before commencing divorce proceedings are common and can set out alternatives to selling your house, should you and your wife wish to avoid this at the moment.

• Jennifer Clearie is a solicitor in the family law team at HBJ Gateley Wareing.

• If you have a question you need answered, write to Jeff Salway, The Scotsman, 108 Holyrood Road, Edinburgh EH8 8AS or e-mail: [email protected] above is for general purposes only and is not tailored for individual use. It does not constitute legal, financial or investment advice on any particular matter and must not be treated as a substitute for specific advice. No action should be taken in reliance of the information given. The Scotsman Publications Ltd and HBJ Gateley Wareing accept no liability on the basis of this article.