Since the introduction of no-fault divorce in England and Wales in April 2022, the legal process of ending a marriage has in many respects become procedurally simpler. Couples no longer need to apportion blame, petitions are more streamlined and, in theory, the temperature should be lower.
But when it comes to the issue that really drives conflict – family – very little has changed.
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A divorce or separation inevitably leads to a need to restart your life, including housing, care for children and general living costs. It is a time of great uncertainty, and therefore financial stability (through income, child support or available cash) is the key focus to provide peace of mind for the household that has just been reshaped.
Divorce: A financial restructuring exercise
In practice, the removal of fault has made it easier to start the divorce. It has not made it easier to divide assets, agree maintenance, or determine who keeps the family home and how future security will be funded. Once financial negotiations begin, emotions often resurface quickly. Because divorce, ultimately, is not just a legal event. It’s a financial restructuring exercise.
For many couples, it represents the largest financial transition of their lives: splitting property, pensions, investments, debt and income into two hopefully sustainable futures instead of one shared household. That’s rarely straightforward, particularly in today’s environment of higher borrowing costs and economic uncertainty. This is why process matters.
Adversarial approaches can rapidly erode value through legal fees and entrenched positions. By contrast, mediation and collaborative methods – championed by groups such as Resolution – try to preserve more capital and create space for rational decision-making. When discussions focus on outcomes rather than ‘winning’, both sides typically emerge in a stronger long-term position.
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By GlobalDataThe biggest risk faced in the process is assumption. Many people assume ownership of an asset, or a right to a particular outcome, but this is not guaranteed. Divorce often puts everything on the table for separation and discussion. A meeting with solicitors, financial advisers and accountants can help provide clarity on assumed matters so there are no ‘shocks’ later in the process.
Financial consent order
A key point where financial planning and legal protection intersect is the financial consent order. Too often, couples reach an informal agreement and assume that’s enough. It isn’t. Without a court-approved, legally binding order, financial claims remain open indefinitely. That leaves the door open to future disputes or unexpected claims years later, particularly problematic if one party’s wealth grows through career progression, inheritance or investment returns.
At a time when political and legislative change feel constant, certainty has real value. A properly structured consent order provides finality and enables both parties to plan ahead with confidence. For many, achieving a clean break is not just emotionally healthy but financially prudent.
Another increasingly common scenario is separation without physical separation. Rising mortgage rates and affordability constraints mean many couples cannot immediately fund two homes. Remaining under the same roof, while technically separated, creates practical and financial complications. Here, clarity is critical. What is each person’s borrowing capacity? What liquid savings or pension funds are accessible? How will day-to-day living costs be split fairly?
These are financial planning questions as much as legal ones. Early modelling and professional advice can prevent stalemates and help both parties understand what is realistically possible. In some cases, divorce coaching can also support more constructive conversations around money, which often proves just as valuable as technical advice. Finally, divorce should always trigger a full review of personal financial structures and estate planning. This is frequently overlooked but can have serious consequences.
Key steps include rewriting your will, updating lasting powers of attorney, changing pension expression of wish forms, reviewing life insurance policies, and reassessing Inheritance Tax exposure if assets have been liquidated or restructured. Without these updates, benefits may unintentionally pass to an ex-partner.
No-fault divorce has modernised the paperwork. But it hasn’t removed the financial complexity.
The couples who navigate separation most successfully are those who treat it not as a battle to be won, but as a financial reset to be carefully planned. With the right advice, clear communication and legally robust agreements, it’s possible not just to divide wealth, but to protect it.
Andrew Goulter, Wealth Management Consultant at Mattioli Woods
