Separation & Divorce – Financial Settlement Considerations

Key points

  • There is no precise formula for how a court will make financial orders
  • The court will listen to the evidence and make a decision that is fair based on the circumstances
  • The general principles to be considered by the court are set out in the Family Law Act 1975

Background

When people separate there is often a need to divide up the things they owned and make financial arrangements. Even the Family Court state on their website that it’s generally best if you can reach your own agreement with your ex-partner because it will save money, time and stress.

General Principles

If you apply to the court to have financial orders made there are a number of principles that the Family Law Act requires the court to consider. The principles for marriages and de-facto relationships are set out different parts of the Act, but they are more or less the same.

The key principles are:

  • the assets and liabilities of you and the other party individually and jointly and what they are worth
  • direct and indirect financial contributions by each party including things like property you each had when you began to live together, wage and salary earnings while you lived together and gifts and inheritances from family members
  • non-financial contributions by each party
  • contributions to the welfare of the family such as caring for children and doing housework
  • each party’s future needs taking into account things like age, health, financial resources, care of children and ability to earn
You can read more about the principles considered by the court in making financial orders on the Family Law Court website

This summary has been prepared by MoneyBrilliant Pty Ltd (AFSL 492711). The information in this summary is of a factual nature only and does not constitute legal advice. You should seek legal advice from a legal practitioner before relying on this information. We are not suggesting or recommending that you take any particular course of action in relation to any financial product or service. It does not take into account your personal circumstances or objectives. If you need financial advice or taxation advice you should seek advice from a licensed financial adviser or tax agent. You may also be able to access additional information from the websites of the Australian Securities and Investment Commission (ASIC) or the Australian Taxation Office.

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