One of the biggest concerns in any divorce is how to handle financial arrangements. Do you keep financial ties through ongoing spousal maintenance? Or do you cut ties completely with a “clean break”? Let’s unpack what that really means, the benefits, and the limitations.
What is a Clean Break?
In any financial settlement, the court looks at three basic elements:
- Division of marital assets
- Spousal maintenance for the financially weaker party (helping them get “back on their feet”)
- Child maintenance, where children are involved
Normally, spousal maintenance is paid monthly. But the court’s preference – where possible – is for a clean break. This means that instead of ongoing monthly payments, a one-off lump sum is paid to the financially weaker party.
This lump sum is worked out by calculating the total spousal maintenance that would be payable across the maintenance period and then applying a discount to reflect the fact that the money is being paid ‘up front’.
Why Do Courts Prefer a Clean Break?
A clean break is designed to avoid future financial dependency between ex-partners. The advantages include:
- Certainty: The receiving party knows exactly what they’ll get, rather than relying on payments for years ahead.
- Reduced risk: If the payer’s financial circumstances deteriorate (they might lose their job, their business might fail or they might become bankrupt), the receiving party is protected.
- No enforcement headaches: There’s no need to go back to court if maintenance payments are missed and even worse, if the payer is living outside of the jurisdiction.
- Finality. It’s no longer necessary to have ongoing contact or be reliant on receiving monthly payments.
When Is a Clean Break Not Possible?
Not every couple has enough assets to fund a clean break. If there isn’t sufficient capital to “buy out” spousal maintenance, then monthly payments may still be ordered.
It’s also worth noting that child maintenance cannot be ‘clean breaked’.
Professional advice is essential
If you’re facing divorce or know someone who is and want to explore whether a clean break is right for you, professional advice is essential. Every case is unique, and the consequences last for years.
Who we are.
We are a team of 5 experienced lawyers but, what makes us different to a firm of solicitors, is that we are acting as divorce consultants. We help people navigate the legal maze and stop them making expensive mistakes. We use our experience of the divorce process to find solutions to lower the temperature and save money.
If the above resonates or you know someone who may benefit from speaking to us, please do contact me. We don’t charge for an initial consultation.