Here’s something that might surprise you: even people who’ve been through a divorce often don’t understand how the law actually works when it comes to splitting finances.

Family lawyers have been advising divorcing clients for years now, and they still regularly hear the same misconceptions crop up in initial consultations. “It’s 50:50, isn’t it?” or “I inherited that money, so it’s definitely mine” or “My pension doesn’t count, does it?” The truth is far more nuanced – and far more important to understand if you want to protect your interests.

The research that should give us all pause

Earlier this year, the University of Bristol released findings from the most comprehensive study on public understanding of divorce finances ever undertaken in England and Wales. They surveyed over 20,000 people as part of their Fair Shares Project, and the results were frankly alarming.

Here’s what they found:

The general public got it wrong – badly. On average, people could only correctly identify 4.5 out of 10 statements about divorce law. Worse still, 11% couldn’t identify a single correct statement. We’re talking about fundamental aspects of family law that affect thousands of families every year, and the public understanding is woefully inadequate.

Even divorcees don’t understand the law. You’d think that going through the process would clarify matters, wouldn’t you? Not so. The study found that people who’d actually been through a divorce only performed “marginally better” than those who hadn’t. That means countless people are navigating one of the most financially significant events of their lives without truly understanding the legal framework that governs it.

Having a lawyer doesn’t guarantee understanding. Perhaps most troubling of all, substantial proportions of people who used solicitors still didn’t understand how the law applied to their case. Legal representation matters enormously – but engagement with the process matters too.

Some specifics that illustrate just how widespread these misconceptions are:

• 22% of respondents incorrectly believed they’re not entitled to a share of their spouse’s pension. That’s more than one in five people potentially walking away from what could be a six-figure asset.

• 35% didn’t know the law doesn’t prioritise the parent with whom children primarily live. The welfare of children is actually the court’s paramount consideration.

• 30% assumed all assets are automatically divided 50:50. The reality? It’s far more complicated than that.

• 30% didn’t know that the length of a marriage affects how assets are divided. Duration matters – significantly.

The Nuffield Foundation, which funded this research, put it bluntly: many people are divorcing with little to no legal advice, risking “unfair or one-sided financial outcomes and potential hardship which are inevitably costly to undo.”

As the study’s lead researcher, Professor Emma Hitchings, pointed out, knowledge really is power – especially when it comes to divorce finances. Yet far too many people are making life-changing decisions in the dark.

So how do courts actually divide finances?

Let’s clear up the confusion. Here’s what you actually need to know about divorce financial settlements. 

The starting point isn’t as simple as you think

Yes, there’s a 50:50 starting point when it comes to matrimonial assets. But – and this is crucial – that’s merely a starting point, not a rigid rule. The court has wide discretion, and that discretion is exercised based on what’s fair in your particular circumstances.

And fairness? Well, that’s a rather slippery concept, isn’t it?

An equal split might seem fair on paper, but in practice it could be anything but. Imagine a scenario where one spouse gave up a lucrative career to raise children or support the other’s professional ambitions. Is a straight 50:50 split fair when one party has sacrificed their earning capacity and career progression? The courts don’t think so – and neither should you.

What actually counts as ‘matrimonial assets’?

This is where things get interesting – and where many of those misconceptions from the Bristol study come into play.

Matrimonial assets are, broadly speaking, assets you’ve treated as joint during the marriage, as well as those acquired during the relationship. This includes property, savings, investments, pensions (yes, pensions), and even business interests. The same logic applies to debts, by the way.

Non-matrimonial assets might include:

• Assets acquired before the marriage

• Assets acquired after separation

• Inheritances kept separate during the marriage

• Gifts specifically to one party

• Pre-existing business interests

But here’s the catch that trips people up: non-matrimonial assets can become “matrimonialised” over time. That inheritance from your grandmother might have been yours alone when you received it, but if you used it to buy the family home or mixed it with joint funds, the picture changes dramatically.

And even if an asset remains strictly non-matrimonial? If the other party’s needs are sufficiently great – particularly where children are involved – the court may still order that non-matrimonial assets be used to meet those needs. The principle of meeting needs trumps the principle of property ownership. Full stop.

The factors that actually matter

Parliament has given judges a framework for working out what’s fair, set out in Section 25 of the Matrimonial Causes Act 1973. These aren’t abstract principles – they’re the actual criteria applied to your case:

Income and earning capacity. Not just what you currently earn, but what you could earn. If you’ve voluntarily reduced your hours or taken a less demanding job, expect that to be scrutinised.

Financial needs and responsibilities. What do you actually need to live? What commitments do you have? Housing needs, in particular, loom large in these calculations.

Standard of living during the marriage. The lifestyle you’ve become accustomed to matters – though it’s not guaranteed to continue, particularly if the assets simply aren’t there to support two households at the same standard.

Age and duration of the marriage. A five-year marriage is treated very differently from a thirty-year one. The longer the marriage, the more likely assets will be shared, regardless of who brought what into it.

Contributions to the marriage. And this means all contributions – financial and non-financial. Looking after children, managing the household, supporting a spouse’s career… these all count. The court won’t value one spouse’s City salary above the other’s childcare and homemaking. The days of that kind of thinking are long gone.

Conduct. Only in rare cases where conduct is particularly egregious will this affect the financial outcome. We’re talking serious misconduct here – not having an affair or being generally difficult.

When children are involved

If you take nothing else from this article, remember this: the welfare of any child under 18 is the court’s first consideration when determining financial arrangements. Not the primary consideration, not an important consideration – the first consideration.

The court will look at:

• The children’s financial needs

• Any disabilities they may have

• Educational needs and expectations

• Where they’ll live and with whom

• What arrangements will provide them with stability

This is why the parent with primary care often receives a larger share of the assets, particularly the family home. It’s not favouritism – it’s ensuring children’s needs are met. Remember that 35% from the Bristol study who thought the law didn’t prioritise the primary carer? They were wrong, and dangerously so if they were making decisions based on that misunderstanding.

The Clean Break: Not always possible (or desirable)

Where there are no dependent children, courts must consider whether a “clean break” is appropriate – a final settlement with no ongoing financial ties. Sounds appealing, doesn’t it? No lingering financial connections to an ex-spouse?

But it’s not always achievable. If one party doesn’t have the resources to be self-sufficient, ongoing spousal maintenance might be necessary. If there’s a pension that can’t be divided immediately, a pension sharing order might create a clean break on retirement, but not before.

The court’s preference is generally for a clean break where possible, but “possible” is doing a lot of heavy lifting in that sentence.

Why this matters more than you think

Let’s return to those Bristol findings for a moment. The reason this research matters isn’t just academic interest in public legal knowledge. It matters because misconceptions cost people money and cause unnecessary conflict.

If you go into divorce negotiations believing you’re entitled to half of everything (you might not be), or that your spouse has no claim to your pension (they almost certainly do), or that inherited money is automatically protected (it often isn’t) – you’re setting yourself up for disappointment, costly disputes, and potentially unfair outcomes.

All family lawyers have seen clients who’ve made significant financial decisions based on incorrect assumptions about what they’re entitled to. They have seen people give up assets they should have fought for, and fight for assets they were never going to keep. Both scenarios waste time, money, and emotional energy.

The Courts have wide discretion – and that cuts both ways

Here’s something else that often surprises people: there’s no formula for divorce settlements. Unlike child maintenance, which has clear calculation methods, the division of assets on divorce is highly discretionary. Two couples with seemingly identical circumstances could receive different outcomes based on the specific factors in their case.

This discretion is both a strength and a weakness of the system. It allows for fairness and flexibility, but it also creates uncertainty. You can’t plug your numbers into an online calculator and know exactly what you’ll receive – anyone who tells you otherwise is selling you something.

What this means practically is that early, expert legal advice is essential. Not just because you need someone to handle the paperwork (though you do), but because you need someone who understands how these principles actually work in practice, who’s seen how judges apply discretion in cases like yours, and who can give you realistic expectations.

What you should do next

If you’re facing divorce, or even just contemplating it, here’s some advice:

Get proper legal advice early. The Bristol study showed that even people who used solicitors didn’t always understand the law – so make sure you’re engaging with the advice you’re given, asking questions, and pushing back if something doesn’t make sense.

Don’t make assumptions. That 50:50 starting point? It’s a starting point, not a destination. Your inheritance? Might not be as protected as you think. Your pension? Very much in play. Challenge your own assumptions, because they’re probably wrong.

Think about needs, not just entitlement. The court is focused on what’s fair, and fairness is largely determined by needs – particularly when children are involved. What you want and what you’re likely to receive may be two different things.

Consider your children first. If you have dependent children, their welfare drives the financial decisions. Fighting over assets at the expense of their stability helps nobody – and the court won’t thank you for it.

Document everything. Particularly if you’re claiming assets are non-matrimonial, you’ll need evidence. Inheritance? Show the paper trail. Gift from parents? Get it in writing. Owned before marriage? Prove it.

Be realistic about the pot. Many divorcing couples discover that two households cost a lot more than one. The comfortable lifestyle you maintained on a combined income may not be replicable when that income is supporting two homes. The sooner you accept that reality, the better.

The bottom line

The Bristol research revealed something family lawyers have known for years: there’s a huge gap between what people think the law says and what it actually says. That gap costs people dearly – financially and emotionally.

Divorce is rarely simple, and the financial side is often the most complex and contentious aspect. The legal framework exists to ensure fairness, but it’s nuanced, discretionary, and fact-specific. What applied to your friend’s divorce may not apply to yours. What you read in a tabloid article about a celebrity divorce almost certainly doesn’t apply to yours.

Your best protection against unfair outcomes isn’t hoping for the best or relying on assumptions. It’s understanding how the law actually works and getting expert advice to navigate your specific circumstances.

Because, as that University of Bristol study made painfully clear, what you don’t know absolutely can hurt you – and your children – when it comes to divorce financial settlements.

If you’re facing divorce and need clarity on how the law applies to your situation, speak with a specialist family lawyer sooner rather than later. The earlier you understand what you’re facing, the better equipped you’ll be to secure a fair outcome.

The University of Bristol’s Fair Shares Project report “Understanding of the law around finances and property on divorce” was published in January 2025 and can be accessed at bristol.ac.uk/law/fair-shares-project. The research was funded by the Nuffield Foundation.