The breakdown of a marriage is often a difficult and emotional time, but you need to understand how divorce settlements operate and what you may or may not be entitled to at settlement. Unfortunately, there are a number of myths in the community regarding divorce settlements, so in this post we hope to clarify some of these misunderstandings.
Common myths of divorce settlements
No two marriages are the same and no two divorce settlements are the same, so if you assume that your divorce settlement will be the same as a friend’s settlement for example, it’s rarely so simple.
Let’s start by debunking three myths regarding divorce property settlements. And if you want to know more, we recommend speaking to a divorce lawyer.
Myth 1: All assets are split 50/50
There is no law or rule that specifies an equal split of assets in a divorce settlement. Nor is there a formula used by courts to make this determination. Instead, there are a number of factors that are taken into consideration, which combined, lead the court to a decision. These factors will be discussed towards the end of this post.
Myth 2: Women always get a better deal
Whilst this is often a widely held belief, there is no evidence that this myth is true. What we do know from research, however is that men recover faster financially following a divorce, mainly because they continue to progress their career throughout their marriage. Women on the other hand, often find it more difficult to return to work (particularly if they have stayed home to raise their children) and have more difficulty earning an income sufficient to support the lifestyle they enjoyed during their marriage. Obviously, there are exceptions, simply because no two divorce settlements are the same.
Myth 3: To get a good deal you must go to court
If you can amicably settle your property between yourself and your partner, there is no need to go to court. Often mediation is required, but this is completely different to attending court.
Factors that are considered by a court during a divorce settlement
These factors are included in the Family Law Act and the settlement is based on the all information provided to the court. If a proposed settlement is given to the court, whether or not this is accepted or altered by the judge, depends on a range of factors that include the following:
- The net value of your worth as a couple. This includes superannuation and any assets or liabilities held in trusts, companies or partnerships, as well as those held personally.
- Indirect and direct contributions to the relationship. For example, if one partner gives up their career to further the career of their partner or makes financial contributions to purchase or maintain assets, including those held at the beginning of the relationship.
- Non-financial contributions to the relationship: For example, raising of children, but this can also include efforts made to increase the value of an asset, such as renovations to buildings.
- Future needs of each individual: Considerations are made for the care of their children, and the health, age and income earning capacity of each partner, as well as their superannuation and financial resources.
It’s important to remember that the court will make a divorce settlement that is equitable and just, based on the above information. If you have recently separated or are considering a separation, you are welcome to engage our family lawyers by calling on 134 134 or send us an email enquiry.