Matrimonial and non-matrimonial assets
12 January 2021
When getting divorced, it’s important to distinguish between your matrimonial assets and your non-matrimonial assets. This could make a difference to your Financial Settlement after your divorce.
What’s the difference between matrimonial and non-matrimonial assets?
Matrimonial assets are financial assets that you and/or your spouse have acquired during your marriage. Non-matrimonial assets are financial assets acquired by you and/or your spouse either before you got married or after your divorce.
Matrimonial assets typically include things such as the family home, pensions and savings. It doesn’t really matter who put the money forward for these assets or who accumulated the wealth. When you’re married, the law in England and Wales considers that any assets you acquire during the marriage also belong to your husband or wife. So, for example, if you contribute towards a pension during your marriage, your spouse is entitled to a share of it.
Non-matrimonial assets typically include things like inheritance, family businesses and property that was purchased before the marriage or after separation.
Why does it matter whether assets are matrimonial or non-matrimonial?
Matrimonial and non-matrimonial assets matter when it comes to divorce and separation because you and your ex will need to divide your finances between you. This is formalised with a Financial Settlement. The arrangement that you reach must be fair and reasonable to both of you.
However, there may be some debate as to which assets should be included in the Financial Settlement. For example, one person may feel that the inheritance received from their Great Aunt 10 years before they got married should not have to be included in this settlement.
So what should and shouldn’t be included in the Financial Settlement when getting divorced?
Matrimonial assets will, by their very nature, be shared out between you and your spouse during divorce. This means you’ll need to divide the finances that were acquired while you were married, even if the money was income from your job or inheritance from your family.
Matrimonial assets won’t necessarily be split 50/50. It really depends on the financial situation of each person. Essentially the law in England and Wales requires each person to receive a fair settlement that meets their financial needs. So if you need to give up a third of your pension pot to ensure your ex is provided for, that is what the Court will rule.
Non-matrimonial assets are a little more complicated. Often you can ask for them to be excluded from the Financial Settlement. But this request might not always be granted. This might be because the non-matrimonial asset was used somehow in your marriage. For instance, if you used the inheritance from your Great Aunt as the deposit for the family home then the family home will still be considered a matrimonial asset.
Or it might be that the matrimonial assets do not sufficiently provide for your ex, or the welfare of your children. If so, the Court can rule that non-matrimonial assets be included in the Financial Settlement too.
Protecting your assets
If you’d like to protect your assets from a future Divorce Settlement, you can do so by putting a Pre-nuptial Agreement in place (or a Post-nuptial Agreement, if you’re already married).
Although pre and post nuptial agreements aren’t legally binding in England & Wales, the Courts will consider them seriously when deciding what assets should and shouldn’t be included in a Financial Settlement.