Finally separating our finances - is this fair?

[BetsyHolme]

My husband and I separated back in January due to his mental health. We have been in the family home all year. Now, things are finally moving in the right direction, and he is looking for a house.

A little bit of background:
We have been married for 12 years and together for 19, and we have two kids aged 9 and 7. We would like to work out financials between us to avoid animosity. The kids will be 50/50, and I won't challenge him on this as he's a brilliant dad.

He has always worked, albeit not with a big salary, until the past year, when he was unemployed and spending inheritance cash or accruing credit card debt to cover household costs. He is capable of earning a full-time salary in his mid-40s.

I worked full-time until our eldest was born, then didn't work for 5 years, and now I work part-time, 25 hours a week. I earn about 1.5k a month, and I will be entitled to a small amount of universal credit to top up my income to around 2kish once im independent.

Financials:

We have a family home that will be sold in the next few months. This leaves us with equity of approximately 280k—300k.

He is selling his mother's house, and from this sale, he should receive in the region 525 550k.

He has approx 50k in credit card debt (I think)

I have about 15k of debt (including recent car finance I had to take out when my car blew up 😣)

He has been advised that he may be able to ringfence his inheritance from the marital assets, subject to both parties' needs being met. To be honest, I do not want to go after any of the inheritance; I do not view this as mine.

He plans to buy a three-bed house in cash upon completing the sale of his mum's house. I will buy a house with the equity of our family home and with the help of a small mortgage (I can borrow up to about 80k)

Thank you if you have gotten this far!! We are about to start putting down some figures, and I really would like to know what other people think is fair based on my circumstances.

I suspect his idea will be that I stay away from his inheritance, take a majority share of the equity in the family home, and use this as a large deposit on a house, topped up by a small mortgage.

I do have a feeling that he wants a share of the family home equity to pay off his debts; total debts around the 70k mark would take the equity down to approximately 220k. Then, with legal fees and stamp duty, it could be 200k, giving me a budget of around 280k to buy a home. It's not impossible, but certainly not as nice as the one he's buying for 375k.

Pensions are negligible, so I'm not bothered by that.

I want to go in confidently with an objectively fair figure.

Does anyone have any thoughts?

If we need to involve solicitors, then I suppose we will, but the intention is to try and solve the problem ourselves, certainly in this first chat.

So my question is, what do you think is fair? What would you ask for in my position? What is the minimum you would accept?

Thanks so much in advance for any thoughts xx

OP - take proper advice.

If he has already been using inheritance to add to the running of the household for the past year - it can be argued that the inheritance has been "co-mingled" to the family assets. So - it will be fair to take the totality of assets, take away joint debts and then divide 50/50.

In any negotiations - I'd start with it as a starting point. Then, if you want to then get to a place where he'll think he is getting an upper hand - I'd suggest that you might consider a different solution where he takes his debt from his inheritance pot, and you get a larger share of the marital home equity.

In divorce - the fairness of division is based on need. As you have children - you both need to provide for their housing needs - and so it is unfair if you are left with significantly reduced assets, while he buys a large house with cash.

Your desire not to become acrimonious is admirable - but I don't know any man who willingly gave away a fair share of his money. It's rare - and you need to become thick skinned and fight for what is fair for the children.

When you’re having 50/50 though you won’t need to be doing all pick ups your ex should be doing them on the days he has the DC. You could also work more on the days you don’t have the DC so you wouldn’t need to pay any sort of childcare. It’s all doable just takes time to arrange etc and obviously getting settled into the routine of having DC only 50% of the time

Negotiations tend to be about splitting it so that both parties needs are met - if taking all the inheritance (which isn’t automatically included or excluded more on a needs basis) plus a chunk of equity leaves you and your time with the children needs not met then that is unfair

get legal advice

Get legal advice, and unless you both have reasonable pensions plus state pension, do my discount splitting his if his is much larger than yours. Legal advice all the way, it might be amicable now and he says/she says but it can turn quite quickly.

Oh absolutely not! His days are his days. On my days I will not be doing school runs and ill certainly be trying to maximise my income where I can.

Thank you, everyone, for your thoughts. It's awesome to get some feedback and try to make a plan for the next steps.

If anyone else wants to share their thoughts, I welcome them, even if they are not necessarily what I want to hear.

I might even show him this thread to be honest, seems pretty balanced on the whole.

@BetsyHolme I mean the properties .

I fully agree he will have a nicer house than me, he has a bigger budget, but I would be looking at something pretty grim if he took 50% of the family home assets if I could get anything at all
What do you mean by grim? Would he agree with you and feel that he would want the children to live with you somewhere that isn't grim? If so and he is happy on this basis that you get more of the equity, that's all fine.

If he doesn't, because he feels that you could get something decent, even if it maybe means moving slightly further away, or that you could get a higher mortgage if you increased your hours, that might be more complex. A judge might or might not agree. Ultimately, what you don't want is either of you spending the equivalent of any amount you are disputing in legal fees.

You need to try to come up with some firm of co promise that is reasonable for you both.

You may want to get a financial auditor to assess the situation. It costs about 1500 but well worth it .

You are correct.

A guide to financial arrangements after marriage breakdown | Rights of Women

"I just want to be able to live and provide a home for the kids" - you need to keep this front of mind, OP. It is laudable to want to be "fair" in the present, but that is not necessarily the same as what is equitable in the future.

This guide can be useful (it provides a list of everything that can be taken into account as a marital asset, including properties owned by either party, but no specific mention of inheritance). You need to take advice because while "fair for now" might look like a roughly 50/50 split of house/cash, "equitable over time" might actually be more like splitting the family home AND the inherited house so that you both leave your 19 YEAR RELATIONSHIP with a decent standard of living and secure home for your kids.

It's not as if you rocked up yesterday and are now trying to steal his mum's house.

Have you discussed anything at all yet? What do you think he is likely to want from the marital home?

You say he has lived from inheritance in the past year. Is this his mum? Other assets than her house?

When did she die? Before your official separation or after?

How old are you both? How severe are his mental health issues? Is he likely to be able to go back to full employment?

What do your debts relate to?

You don't have to be super specific but just interested to know whether they are personal or family related - if you mutually agreed to put a family holiday on credit card, it's a bit different to if he spent 50k on personal things.

Given the sums in question, I think you need to base this off need, and center the children.

You both need to have houses that can house 1 adult and 2 children. So, ideally 3 beds without too stark a disparity for the DC (it's fine if one has a spare room and a larger garden and garage and the other has none of this; but it's not fine if DC have to share bunk beds in one room in one house and get their own King-sized beds in large bedrooms in the other). Anything beyond that in terms of fanciness is up to each of you, out of non-shared income.

Child-related costs will be borne equally. Your household incomes are your own business, both of you.

Ideally you'll live close to each other.

Ideally, there will be no more children for either of you, step or biological but you can't know this now so have to make an assumption that there may be, one day. You should minimize any rancour at this stage because there may be a tonne more to come.

Once you start down the road of your or his rights, your or his debts, your or his equity, you have to go all the way. Neither of you can cherry pick. Just remember the DC and a harmonious co-parenting relationship are at the center of this.

In practical terms, I think if you pool all monies (yours as a couple, his inheritance) and see all debts paid off, then split remaining monies 50/50 you will be set up equally (more or less) because you're both in everything together regardless of who inherited what/who paid what. (If he says he worked and contributed more to the home then you can reply that you took the pay cut to do childcare etc). Or, he can pay off his debts from the inheritance and keep the rest for his house, you can pay off your debts from the home's equity and keep the rest as "recompense" for the paycut you took to be with the children seeing as you're now in the position of putting a price on that because you need to set up separate homes. Either way, the children will get more or less the same home with both of you.

This

Im correct or Doggy is correct? Sorry, just to clarify...

Quite a lot of shrill nonsense here. I would log off and go and speak to a solicitor.

We have got as far as me saying I dont want his inheritance and him agreeing that I will need a bigger share of the marital assets. Now its all becoming a bit more practical the conversation will be centring around how much of the family home equity Im going to get and what happens with the debts and costs etc

Sorry, in answer to your other questions. I think hes going to want to pay all the debts from the sale of the family home and the rest to me. I 'think'

Yes, its his mum, she died in October 2023 and he hasnt worked since around July/August 23. She left a little cash (approx 50k) and that has been frittered away on the defecit that him not bringing in an income has generated. We separated officially in Jan 24 although we had been living in separate rooms etc for a long while before that sadly.

We are both early 40s. He should be able to return to work, it has been over a year since his mum died so although I know its still hard I think hes in agreement that he should go back to work. And i really hope he will as it isnt healthy for him not to.

Please just go and see a solicitor. It will be money well spent.

It sounds like he wants all of his inheritance, and also wants his debts paid off from the marital assets before any split of those. So of course it suits him perfectly to try and "work it out" without involvement of solicitors.

That's because has everything to lose and you have everything to gain.

Until you have the conversation with him, you won't know what he wants but please at least find out what would be the minimum you are legally likely to be entitled to, as a starting point for negotiations.

I guess it just accumulates over the years; there's certainly a holiday or two in there, some debt consolidation. It would be almost impossible for me to work out how they had been attributed over the years. They are all credit cards in his name. Until his probate came through, he used them to subsidise him not working. I have no idea what he has left of the actual cash inheritance he has left; he says not much, but I don't know a figure.

😬I think i just wanted some opinions before we had a chat. Maybe just checking myself to see if I was being fair!

But you need informed opinions @BetsyHolme Not what folk on here think. Legal opinion is what you need before you start discussing with your STBX. Quite outrageous that he pays all his debt off the family home before then splitting the rest 50/50. Without his inheritance coming into the equation, it will absolutely NOT be fair to you. He's onto a good thing at the moment -and already trying to shaft you!!

People's idea of fairness on Mumsnet is quite detached from reality or what a court would deem fair I'm afraid. Your case is one of those weird ones where the devil is going to be in the detail so you really need a solicitor with time to pore over every detail.

This might depend on whether it is family debt. And whether the family pot is enough to meet the needs of both parties without touching the inheritance. It'll depend on all kinds of factors.

I'm not sure we even know what the parties earn, or have I missed that? Because the outcome if the OP earns, say, £60k and he earns £15k vs one where they earn £30k each vs. one where they both earn a lot etc etc will point to different outcomes.