What’s a financial clean break order?
A clean break is a court order settlement whereby a lump sum payment and/or property transfer is made with no on-going maintenance. A clean break ends the financial relationship between the two parties. Once the break occurs neither party can make a further claim against the other. Without a clean break order in place either party can comeback at a future date to make a claim against their former spouse. Any future inheritance or lottery win could therefore encourage your former spouse to request to re-negotiate the divorce settlement based on current circumstances.
There is no time limit for this. So it could happen many years after the decree absolute if either party’s circumstances change.
A clean break may not be achievable:
– A clean break is normally not appropriate where there are young children and there is a continued obligation on one party to pay spousal and/or child maintenance.
– If there are insufficient assets to provide both parties with adequate finances to each set up a new home, and be financially self-sufficient.
– If one party has significantly less earning capacity than the other, a clean break would require a transfer of a large proportion of the assets. This may not be practical.
An alternative is to have a joint lives order.
If you would like a recommendation to a solicitor please contact me on 01932 698150 or email mary@marywaring.co.uk
photo credit:flickr/nick wheeler
Read More
If you enjoyed this post, we recommend the following as additional reading.
Do you bury your head in the sand regarding your finances?
I have some clients who come to me feeling almost shell shocked their husband has asked for a divorce. In many instances these women weren’t even aware there was a problem in their marriage. Some clients come to me and they’ve known for a long time their marriage wasn’t right, they weren’t happy, but they…
What happens to business assets on a divorce?
If you and your husband are divorcing and he has significant assets and money within his company, can these be taken into account as part of the financial negotiations? If you’ve heard the outcome of the recent case Petrodel v Prest you may be inclined to think that they will automatically be included. However, this…
Improving your state pension entitlement
Prior to 6th April 2016 if a couple were going through divorce, or dissolution of a civil partnership it was possible to substitute the National Insurance (NI) record from a former spouse/civil partner if they had a better NI record. Therefore, potentially a non-earning spouse could still receive a full state pension if their…