How to sort out your finances on separation if you were cohabiting

Money Advice Service

If you’ve been living together as a couple and then separate, you have fewer rights than couples who divorce or dissolve their civil partnership. Your break-up will be more straightforward if you can agree about the things you are dividing, such as your property, possessions and assets.

Assessing your situation

Many couples who live together separate without using a solicitor. Unlike divorce or dissolving a civil partnership, there’s no formal legal process to go through.

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But you might still want to take legal advice or mediation (using an impartial third party to help you reach agreement) in some situations, for example, if you and your ex-partner are in dispute about:

  • Any debts you have;
  • The home you’ve lived in;
  • How to split what you own, or
  • Arrangements for your children

There are several ways to handle the separation:

  • You can arrange your separation entirely on your own.
  • If you believe you have a claim against your ex-partner or they are going to make a claim against you, you can talk to a solicitor to find out what you can do.
  • You can use a mediator to help you both reach an agreement.

If you use a solicitor for lots of face-to-face meetings and telephone calls – and especially if your case goes to court – the overall legal costs could be very expensive.

If you can, try to avoid arguing with your ex-partner through a solicitor

Agreeing on finances

Sorting out the finances might take some time and might not be straightforward, but it should be easier if you follow these steps:

  1. Make a list of what you own and any debts you have. Include everything from your home to your savings, household items and your car. Usually, the person who owns an item is entitled to keep it. But the ex-partner might be able to make a claim.
  2. If you don’t know what your possessions are worth, you might need to use experts. For example, you could check how much properties like yours are selling for in the local paper, talk to a local estate agent or look online at property websites.
  3. Next, start to work out how you would like to divide your possessions, and who will pay bills and loans. If you can’t agree how these should be divided, start with our guide Sort out joint bank accounts, insurance, bills and other finances with your ex-partner.
    If you can’t agree how your home should be divided, what you can do, and whether your ex-partner can make a claim, will depend partly on where in the UK you live. Find out more about Dividing the family home and mortgage during separation. If you rent, your rights will usually depend on whose name is on the tenancy agreement. Read more in our guide Dividing the family home and mortgage on separation – renting.
  4. Try to agree how you will support your children. As parents, you’re both expected to pay towards the costs of your children. There’s more information on how to do this in How to arrange child maintenance.

It’s a good idea if you can draw up an agreement that explains how you’ve decided to divide everything.

You’re both more likely to stick to an agreement if it’s written down, and it should reduce the chances of confusion later on.

Some couples find it impossible to agree how to split the finances, or they can agree some things but not others.

If that’s your experience, you might find it helpful to use an impartial third party, such as a mediator to broker an agreement.

Another option is to take legal advice from a solicitor. However, you might need professional help if:

  • You took out a loan for your ex-partner which they can’t or won’t pay
  • You don’t own the home but want to make a financial claim against your ex-partner.
  • You and your ex-partner have a joint business that you can’t agree on how to divide.
  • You and your ex-partner own your home between you but can’t agree how to split it.
  • You and your ex-partner have a joint mortgage and you can’t agree who should pay what.
  • You and your ex-partner drew up a ‘living together agreement’ which set out how you would split your finances, but they are refusing to keep to it.

Making a claim in court

If your ex-partner won’t negotiate at all or is ignoring your legal rights, you might have to go to court to make a claim against him or her.

England and Wales

You might be able to claim a ‘beneficial interest’ in your home or another property if it is owned by your ex-partner and you had an agreement or an expectation that you would share its value if you split up.

Scotland

You might be able to make a claim against your ex-partner if you have been what’s called ‘economically disadvantaged’ (which means you are financially worse off), or if your ex-partner has been ‘economically advantaged’ by the relationship.

You cannot claim for ongoing payments, but you might be able to make a claim for a lump sum.

You have to bring any claim within 12 months of breaking up with your ex-partner, so make sure you don’t miss the deadline.

Northern Ireland

You might be able to make a claim against your ex-partner for a return of money you paid towards the mortgage, if you moved into their property.

Court action costs

The rules about when you can make a claim can be complicated, so it’s best to talk to a solicitor who specialises in disputes between cohabiting couples who are splitting up.

But remember, taking your ex-partner to court can be financially as well as emotionally costly.

You can find a solicitor:

Your next step

This article is provided by the Money Advice Service.

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Some important information about Rest Less Money

We want you to understand the positives, but also the limitations of using our site. We operate in a journalistic manner and therefore all information, guidance or suggestions provided are intended to be general in nature, and you should not rely on any of the information on the site in connection with the making of any financial decision.

When we set out to build Rest Less Money, we wanted to be a trusted place where you could find helpful information about financial matters affecting the over 50s. As a free to use resource, we try hard to provide the best information we can, but we cannot guarantee that we won’t occasionally make mistakes. So please note that you use the information on our site at your own risk, and we can’t accept liability if things go wrong.

Key things to remember when using Rest Less Money:

We do not offer financial advice – As a journalistic site, it’s important to know that we do not provide financial advice. You should always do your own research before choosing any financial product so that you can be certain it is right for you and your specific circumstances. If you are in any doubt, please seek professional financial advice from a regulated financial advisor.

No Liability – please note that you use the information on Rest Less Money at your own risk and we can’t accept liability for how you choose to use the information given on our site. We will often provide links to content or products and services available on other third-party websites. These are provided purely for your convenience and we cannot be held responsible for any content, or any of the products and services offered on any website that we link to.

 

Accuracy of Information – We try to make sure that all the information provided on Rest Less Money is correct at the time of publishing as we want it to be the most helpful resource possible. Sadly, we are not perfect however, and so we can make no guarantees as to the completeness, accuracy, adequacy or suitability of the information available on the site.
Whilst we work hard to try and provide accurate information, deals and prices can change, so whilst they may be correct at the time of writing, providers may subsequently decide to alter them later – so always double check first.

A final note on the Rest Less Community Forums – always remember that anyone can post their opinion on the Rest Less Community Forums, so it can be very different from our own opinion and may not be factual or well researched. Always be wary of any content posted on the forums and be sure to do your own research and due diligence on anything suggested. 

We hope you find Rest Less Money a useful resource and we would welcome your feedback at [email protected] on how to make it even better. For more information on any of the above you can read our full terms and conditions.

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