Working out how to divide assets during a divorce is tough, and people often get confused about what their spouse is entitled to. People are particularly concerned about their savings and what will happen to them during the process.
If your savings are in a joint account and you have both been paying in, it’s fairly clear what happens here. The money will be divided up and the exact division will be discussed during negotiations. But what about money in a separate account in your name? Are you entitled to keep it all or can your spouse make a claim to some of that money? Here’s everything you need to know about what happens to your savings during a divorce.
Is Your Spouse Entitled To Your Savings?
You might assume that an account in your name that you have paid into on your own is separate from the divorce proceedings but that is not the case. When you are negotiating the settlement, you have to decide what to do with all of your assets and then file a financial order once an agreement has been made. During this discussion, your savings will be taken into account. It is assumed that, as the savings were built up when you were married, they are a joint asset and must be split accordingly.
However, there are some exceptions to this. If you bought the savings into the marriage and neither of you contributed to them since, they may be exempt. In cases where you inherited the money personally, your spouse may not be entitled to them either. Any savings that were built up since you separated should also be exempt.
How Will Your Savings Be Divided?
The way that savings are divided varies in every case and it will be decided during negotiations. Solicitors will attempt to find the fairest possible solution for everybody, and a 50/50 split is usually the starting point for negotiations. However, there are other factors to consider, so splitting the savings down the middle is not always the fairest way.
For example, if you are going through a divorce when you have children, you need to consider who they will live with. That person may be entitled to a larger share of the savings so they can provide for the children.
The income and earning capability of both parties will also be taken into account and if one person earns significantly less, they may be awarded a higher percentage of the savings.
If one person is keeping the property instead of selling it and dividing the money, the other person may be awarded more in savings to account for this.
There is no short answer here because all of these factors need to be considered before an agreement is reached. Hopefully, this process will go smoothly but sometimes, the negotiations can drag out for a long time.
The bottom line is, your personal savings are not safe during a divorce and it is likely you will have to split them with your spouse.