How to save thousands on your divorce
The cost of living crisis, increase in energy bills, interest rate hikes and fuel costs are certainly making an impact on many of our pockets. We asked our managing director to come up with 7 ways to save people money when going through a divorce. And you can read his suggestions here along with his overall advice. We hope using some of these tips will keep more money in your family pot where it belongs – up to £32,500!
1) DIY Divorce
Apply for the divorce yourself. It currently costs £592 to petition for a divorce, which you can do yourself online. The paperwork is relatively straightforward and due to the no-fault divorce law, you no longer need to apportion blame or give details of any adultery. You also do not need to wait 2 years after separating.
If you are on a low income, you may qualify for a fee remission. You can check with this easy to use court costs calculator here – and it is worth checking even if you have a full-time job. If not, you can agree to share the cost of the divorce petition between you. You can even co-petition together if you prefer.
Saving Tip: You don’t need to pay a solicitor to manage the divorce paperwork part of your divorce. You can do this yourself. Amount Saved: average £800.
2) DIY Parenting Plan
Agree the parenting arrangements between yourselves. Without a doubt the best two people to decide the arrangements for their children are the parents themselves. By focusing on matters from the child’s perspective and not your own – viewing, as the courts do, that a child has a right to a good and loving relationship with both their parents – you may find it easier to complete a parenting plan yourselves. If the children are over 10, their views and wishes should be taken more into account. At ages 13 plus, the court is likely to go with their wishes.
If you cannot agree, the next logical step is to try family mediation. If you are on low-income and do not have much in savings, you may qualify for legal aid for family mediation. If not, the UK Government currently offers a scheme, where you get up to £500 in vouchers towards your mediation for child arrangements.
Saving Tip: use the voucher scheme to save you £500. But hurry, it is only guaranteed to last until March 2023.
3) Negotiate Fairly
Agree the financial arrangements between yourselves. This is where most couples start – and done well and fairly, you can get to an agreement this way. Try to look at the situation as a joint problem you need to solve – how do we fund two households with the money we have, when before we only had to fund the one? If you can work together to solve that issue you are well on your way to a fair agreement.
If you want your agreement to be made legally binding and also have a clean break financially, you will need a clean break consent order. You can get one of these online, through a solicitor or through family mediation. Clients have recently been quoted upwards of £5,000 plus VAT for a consent order, so do shop around as costs can vary significantly. And ask for a set fee where possible whilst checking what is included (ie pension sharing annex, submission to the court etc).
Saving Tip: If you reach an agreement between you, you can have the consent order drafted online. This will be an average of £1,000 cheaper than using a high street solicitor. But please do check the services’ feedback, reviews and their timescales first.
4) Arbitration not Court
Avoid going to court at all costs. If you cannot agree between yourselves or through family mediation, try one of the other 11 methods to reach an agreement. If you only agree on one thing in the whole process – try to agree on which method(s) of dispute resolution you will use. In the worst-case scenario, if all other methods have been tried and exhausted, then agree to go to arbitration instead of family court.
You still get a legally binding outcome, which must be adhered to, the only difference if you both need to agree to attend arbitration. At a family court you are summoned and a legal order could even be made in your absence.
Saving Tip: Arbitration will cost from £3,000 to £10,000 between you, depending on the amount of legal advice, preparation and representation required. Most solicitor will quote you £20,000+ to be represented at a full 3 hearing financial application.
5) Be Reasonable & Responsible
Act reasonably and responsibly. If you respond to solicitor letters in a timely manner; try to negotiate fairly; attempt family mediation to resolve the issue and make a full and frank financial disclosure (for financial arrangement) you are less likely to be ‘punished’ by the court in any order made. In addition to this, the other side is less likely to be successful in any request for you to pay their legal costs of the process.
Saving Tip: Be reasonable and responsible in all your dealings. Check out our blog here for how courts view behaviour in negotiations (not in the relationship) when allocating costs. Saving £10,000 potential costs, but could vary greatly.
6) Use Solicitor Expediently
Use your solicitor for what they are best at – given good and specific legal advice. You wouldn’t pay a vet £150 to come round and feed your dog (!), but many people happily pay a solicitor to read an email letting them know their ex said something sarcastic when picking the children up!
Saving tip: Use your solicitor for getting legal advice to help you reach an agreement. Don’t use them as a confident or counsellor during the process. That’s not their forte and they will be more expensive than a suitably trained counsellor would be. You can easily save £2,000 just by making focused use of a solicitor for their legal advice on your situation.
7) Get Organised
Get your financial paperwork in order. If you want a legally binding financial consent order, that protects you both in the future, start collating your finances now. You will usually need to value anything over £500. Ask you pension provider for a cash equivalent value (CEV) for your pension on divorce – they have to provide you one each year for free, as long as the pension is not in payment.
Remember what you agree in your consent order won’t come into effect until your final divorce order. If you agree a 50% share of your pension fund, and there is a 12-month delay whilst you reach agreement and get the valuations, you will still transfer 50% across when the order does come into effect. Meaning you have paid all that additional money into your pension pot for nothing.
Saving tip: Be expedient and accurate with your paperwork and financial disclosure. The sooner you reach an agreement and put it into practise, the sooner you can move on with your life. If you pay £200 per month into your pension fund, this would save you £1,200 in this example. But it could be a lot more
Total savings: £32,500
If you can focus on both your needs, your ongoing parenting relationship and look to your future, not the past, you will save yourself many thousands of pounds in legal fees, mediation and court costs.
Ali Carter is the managing director of Mediate UK. For over 12 years, he has helped people going through a divorce or separation to ‘find their futures’ by reaching an agreement amicably and keeping them out of court.
Mediate UK are a multi award-winning family mediation service. We can help with fixed fee mediated and consent order packages (when you don’t have an agreement between you) or fixed fee facilitation and consent order packages (when you have an agreement in principal) – and our legal paperwork is always drafted by our highly experienced family law solicitors.