“Divorce Month” Warning: Failure to Secure a Financial Remedy Order Could Have Long-Term Consequences
With January marking the start of “Divorce Month” – a period when thousands of couples initiate divorce proceedings – leading family law solicitors are warning about the risks of neglecting to secure a financial remedy order, alongside the divorce final order.
According to government figures, 27,908 divorce applications were submitted between January and March last year, and the trend is expected to continue in 2025. While many couples focus on obtaining a final order in divorce proceedings to officially end their marriage, experts stress the critical importance of securing a court-approved financial remedy order, known as a Consent Order (if the order records the agreement reached between the parties).
Kelly Parks, Head of Family Law at Banner Jones, explains: "Failing to formalise financial arrangements during a divorce can have far-reaching consequences. Couples who don’t secure a financial remedy order may face having to deal with future financial claims being made against them, many years after the divorce has been finalised.
"Informal agreements are not legally binding and the financial ties are not ended automatically when the divorce is finalised. Pensions cannot be shared without a pension sharing order being annexed to a financial remedy order. Future inheritances may be at risk without a “clean break” order.
"Financial uncertainty and disputes can lead to disputes that directly affect a child’s stability and wellbeing."
Despite these risks, according to the Nuffield Foundation, discussing the findings of the FairShares research project in November 2023, only 2 in 5 divorcees use a lawyer and just one-third of divorcing couples finalise their finances through a court order.
One of the main reasons for this, is the worry of what it will cost without consideration that the legal system is designed to help achieve fairness. This statistic means that ex-wives are often left worse off. One reason is that pension sharing is included in just 10% of divorces, adversely affecting women who generally have smaller pension funds than men.
To avoid these pitfalls, Kelly advises: "It’s really important that couples seek legal advice early. A family law solicitor can provide clarity on your rights and ensure that financial arrangements and agreements are legally binding.
Even couples with minimal assets should apply for a clean break order to sever financial ties and prevent future claims."
"Securing a financial remedy order or setting out an agreement in a consent order to be approved by the Court provides peace of mind and ensures a clean break," Kelly adds. "It protects both parties from future financial claims. Without this step, ex-spouses remain vulnerable to disputes that could arise many years later.
"For those considering divorce in the New Year, seeking legal advice and prioritising financial arrangements is crucial. Formalising agreements through the courts not only safeguards assets but also provides stability for all parties involved and ensures financial security for any children."
By taking early action, divorcing couples can avoid long-term financial and emotional stress, ensuring that both parties are protected as they move forward with their lives.
Contact us today or email familysupportteam@bannerjones.co.uk
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