Statistics show that more people separate during times of financial strain. I have posted before on the subject - Money Worries increase Divorce Rate
A typical Woolley & Co client is in the higher middle income bracket and perhaps the couple have put everything into a pension and their house. Maybe they have over-stretched a little to buy the house. At the moment their capital asset values are tumbling and they are struggling, especially with the added fear of redundancy.
People in this situation often find it hard to afford proper advice and the financial settlement. But it will cost a lot more in the long run if the wrong course of action is taken.
What is needed is creative and lateral thinking from their divorce lawyer often working alongside a specialist Chartered Financial Planner.
At the moment we are seeing all kinds of unusual actions:
- One person keeping the house in negative equity in the hope that it will improve over time, but at least the other is debt free
- People defending (or doing everything they can to slow down) the divorce in the hope the recession ends and their settlement goes up
- Potential payers do all they can to rush things through whilst their assets are at their lowest
- Keeping the house (as it can’t sell at a price which will give them each somewhere to live) and use the spare room.
- Applying to change a previous divorce settlement on the grounds that the recession has caused a previous capital settlement to now be unfair (A Brian Myerson now finds that an Order made about a year ago for set sums payable over time now means he will end up paying his ex-wife 105% of the assets! He is seeking to change that Order.)
The right advice from the right people is even more important in these times.