Immediate Financial Needs on Divorce or Separation

When going through a divorce or separation, your financial position will likely be one of your biggest worries. In this article, we look at different ways in which you can meet your immediate financial needs. 

Child Maintenance

If you have children, then child maintenance may be payable by the non-resident parent. The Child Maintenance Service has some useful information to help you agree on the appropriate level of child support.

Child maintenance is assessed on a percentage of the non-resident parent's income, depending on the number of children they support and how many nights they have the child(ren) in their care. There is a reduction of 1/7 for each overnight stay per week, averaged over a year. There is also a reduction if the paying parent has any other children in their household. A handy child maintenance calculator can be found here.

If you cannot agree on an appropriate level of child maintenance with your spouse/ex-partner directly, you can start a child maintenance claim via the Child Maintenance Service website. 

Child benefit

This is not the same as child maintenance and is paid to you by the Government. Child benefit can only be paid to one person and is usually paid to the parent with whom the children live. You can update your living and payment arrangements here.

Please note that child maintenance is now means-tested; if you incorrectly claim this, you will have to repay it. 

State Benefits

If you have recently separated and are not currently working, you may be eligible for state benefits. The Government website has a useful benefits calculator and has a wealth of information on benefits, including universal credit, personal impedance payment, housing benefits and child and working tax credits.

Council Tax reductions for sole occupants

If you are the only adult in your property, you are entitled to a discount on your Council Tax of 25%. 

Mortgage reductions

In certain circumstances, it may be possible to agree on interest-only mortgage repayments or a mortgage holiday with your lender. This can be explored early on to reduce what may be one of your largest outgoings. 

Interim Spousal Maintenance 

If you are not working and your outgoings cannot be met by the income you have coming in, you may be able to make an application for interim spousal maintenance. This type of application can only be made if you are/have been married or in a civil partnership.

This is an application for your spousal or civil partner to make interim periodical payments to you to enable you to meet your immediate financial needs. Divorce or dissolution proceedings must have been issued to enable you to do this. 

There is no strict formula when calculating interim spousal maintenance, and the court will often take a broad-brush approach by balancing the income/earning capacity of the parties against their immediate financial needs. Longer-term/final maintenance orders and more forensically analysed. 

Help with your legal fees

Compounding the stress of divorce/separation can be worries about how you might pay your legal fees.

Legal Services Order

You can make a court application for a Legal Services Order in certain circumstances. If ordered, this would mean that your spouse or civil partner would have to pay your legal fees or at least contribute to them.

Legal Services Orders are usually seen as a last resort, and it would have to be shown that you have tried to obtain funds in another way first, such as by borrowing. 

Litigation Funding

One way of borrowing money to pay your legal fees is via a litigation funding provider. This is something that can be considered early in your case and even before court proceedings are issued. 

At Myerson, we are able to consider litigation funding with a third-party provider. These loans carry interest, and the interest on the amount borrowed can be paid by you either monthly or rolled over to the final payment, depending on the provider. The loan is repayable in its entirety at the end of the case or within a certain time frame, whichever is the earliest date. 

Please note that litigation funding is not available for disputes relating to children unless there are concurrent financial issues and sufficient capital assets available to repay the loan at the end of the case. 

Here to help

If you would like any further information regarding financial needs on divorce or separation, please contact a member of our Family Law Solicitors below.