Negotiating and finalising the division of assets, commonly called property settlement, can happen at any time after separation. The law is almost the same whether you’re married or separating from your de facto partner. In this blog, we will look at how the future needs of both parties are considered during property settlement negotiations.
Often, future needs play an important role in determining property settlements, especially where there are children involved and/or a significant difference in income and earning capacity.
There is a stepped approach in determining a property settlement. These steps are:
Sometimes an adjustment is made to the property distribution to take into account future needs of a party. This is commonly known as a section 75(2) adjustment or a section 90SF adjustment in the case of a de facto relationship.
Some, but not all, of the relevant considerations for future needs, include:
Generally, the party who will be financially disadvantaged in the future due to the above factors will receive an adjustment in their favour. The idea is to make sure that the party looking after the children (and generally therefore not able to earn as much), receives a fair settlement to help them into the future. Depending on the other factors, including financial and non-financial contributions to the relationship, they may receive more of the assets overall.
In all cases, it’s important to get legal advice early to protect your financial future. Contrary to popular belief there is no automatic 70/30 split if there are children. all factors, including contributions, need to be viewed as a whole and the agreement needs to be just and equitable. Every case is different and will depend on the specific circumstances of each party and each relationship.
Knowing where you stand and what your entitlements are can put you in a good position to negotiate with your partner and help you to make good decisions early.
If you require assistance negotiating a fair and equitable property settlement after separation, or if you’re experiencing any other family law issues, feel free to get in touch directly with today’s blog writer, Mona Emera.
This article is of a general nature and should not be relied upon as legal advice. If you require further information, advice or assistance for your specific circumstances, please contact Emera Family Law.