property market

With the cost of living crisis, people are feeling the pinch of the economic climate more than ever, which can add to the financial pressures many relationships already face.

Money is an essential part of daily life and managing it can be a significant source of stress for couples, particularly if you are considering separation or are going through a divorce. Increases in energy bills, changes in interest rates, the heightened costs of putting food on the table and fuel in cars is certainly having an impact on many families across the country.

When parties separate, they must navigate splitting their money, property, pensions, and debts. Splitting one household into two is never an easy task. The falling house prices, inflation and changes in the job markets can make separating assets, considering tax and maintenance arrangements even more challenging – studies have shown this had led to parties postponing their separation. New research from financial services provider Legal & General Retail has confirmed that 272,000 people have delayed their divorce due to the cost-of-living pressures in 2023.

Conversely, when the economy is fluid and thriving, it can be easier to get divorced because joint resources are likely to stretch further, you can buy and sell homes more quickly and interest rates are more favourable.

If there is no chance of reconciliation and divorce is inevitable, it is important to take independent legal advice from a solicitor as soon as possible. This can help you understand where you stand and help you make informed decisions about whether or not to separate and when, which can potentially help lead to a less acrimonious or costly divorce.

Below are some tips for navigating the cost of living crisis on separation:

  • Make sure you understand your current financial position. Create a household budget which details both parties’ income, monthly expenditure, bills and savings.
  • Consider the costs associated with setting up and running your new homes.
  • Clarify each other’s financial responsibilities and consider how debts accrued during the marriage will be cleared or managed.
  • Be open and transparent about your finances and income. Avoid unnecessary delays by engaging with the process and provide full and frank disclosure.

How Stephens Scown can help you

Going through a divorce can be difficult, our specialist Family Law solicitors are here to help you go through the process. You can speak in confidence to a family solicitor, to help you understand your legal options before you take the decision to separate, or afterwards, and consider your next steps.