Divorce complex finances

[crumpetswithcheeze]

I have a friend, let’s call them A. A has been married to B for 40+ years with 3 adult DCs. On paper neither A or B have any assets other than A having a car worth approx 3K. Throughout married life A and B have lived rent free in a house owned by a family member of B. In effect, the house was gifted to B, but deliberately kept in a family members name to prevent A having any claim on the house in the event of the marriage ending.

A was a stay at home parent and raised the children for 10 years, before returning to work part-time when DCs were teenagers, and now full time, in a low paid job, no savings.

A has been told that should they proceed for a divorce, they would be left with nothing, other than their car, and state pension, whilst B stays in the marital home, with cash savings and state pension.

Is this correct?

I would assume most of that was right (it’s not technically a ‘marital home’ is it?) but the cash savings would presumably be split, arguably with more in A’s name as they will have greater need?

I would assume most of that was right (it’s not technically a ‘marital home’ is it?) but the cash savings would presumably be split, arguably with more in A’s name as they will have greater need?

Does B not have a private pension as well if they have been working their whole life? That would also be split.

If both members of the couple really have no assets, yes.

If neither party own the property, then it isn’t a marital asset.

What are assets, are savings and pensions. What does B have there?

Yes. The home belongs to the family member. They don’t get the home because of the divorce, they get the home because presumably the family member will allow them to continue living there.

Thanks for the replies so far. Possibly a small private pension for B, but nothing huge.

Oooh ouch. B is leaving A in the shit. B has obv always known they can rely on having the property as an asset, without A having any of it. Hopefully the 3 children of A and B will learn the lesson and never leave themselves open to being treated the same way. Despicable really.

One might hope B's cash savings would be significant if they have never paid rent or a mortgage. Half of that at least should go to A. But surely even A should have savings, I assume B has paid for household expenses all this time if A has not been earning much? They seem to have had a pretty cushy life really, but where has a lifetime of earnings gone?

They should have amassed savings if they lived rent/mortgage free for 40 years.

I would expect A to be granted some of the savings and pension, but they have been incredibly naive to get themselves into this position at this point in their lives.

Yes they should but reading between the lines, there are no or v little savings. If we’re eg. referring to a 3k car as an only asset.

Well yes, if they’ve been happy to live with their heads in the sand for 40 years, these are the consequences. That was my point.

A has been very foolish… if B has done something eg affair then that’s pretty appalling given the set up.
A needs a good solicitor… they should have understood their vulnerability during the marriage as a SAHP and organised with B to make savings/pension in their name also..

True. I think it’s easy for life to get in the way of what we Should be doing or should have done. Especially 20 or 30yrs ago. Or even 10. The financial side of life has become more crushing in recent years, as the wealth inequality gap widens, no chance of buying a house on average wages, all bills higher, etc etc etc. So whilst it has been heads (or head) in sand I can imagine how it happened. Sadly that doesn’t help A. Who is now going to be looking for a council flat, I would think.

Yes, any savings and pensions should be split, but the house does not belong to B so unless there are unusual circumstances A has no claim. If A put significant money into the house or anything like that they should consult a lawyer.

Like others I’m struggling to understand how they’ve lived rent free for 40 years and not amassed any significant assets, but if that’s the way they both chose to live then I’m afraid A has been immensely foolish.

It might be more fruitful to focus on some positives for your friend A here:

1.It's not a divorce with complex finances. There are very few marital assets, so the process should be more straightforward, quicker and possibly cheaper. This gives A greater leeway to proceed, and less financial leverage for B to use against A.

2.If there are no debts, it's a good position to be in compared to some.

3.If A is not listed as the bill payer for the property utilities, then A could potentially stop making any financial contribution to the household, and focus solely their own outgoings, such as food and transport, and building their savings fund for legal fees and a rental deposit, as well as building up a good credit history.

4.You mention cash savings - (...whilst B stays in the marital home, with cash savings and state pension). A would almost certainly have a claim on these.

5.A has adult children - so has no need to provide housing for them or Uni fees. A can opt for renting something smaller and cheaper, with more flexibility on location.

6.A has been a SAHP or part time for many years - this could mean she might have access to a portion of B's private pension. If B has earnings higher than A, then it might be possible for A to seek spousal maintenance, perhaps for a fixed time frame, particularly if A will likely be homeless in the first instance.

It’s not the marital home. It’s the house belonging to someone else they have happened to live in for a long time and have reaped the benefits of having no mortgage. She should consider that having no mortgage enabled her not to work for a decade and have time with her kids whilst they were young without the pressure of having to find full time employment