Will I have to Work after my Divorce?

There is no doubt that separation and divorce and the maintenance of two households, rather than one, leads to a family’s budget becoming tighter. There are many situations in which our clients become concerned regarding if and how their separation and divorce will affect their plans for their working life. 

One common situation is where spouses have agreed that one of them (usually, the wife) should give up their job in order to care for the children and the house full-time. When the marriage breaks down this may not be affordable and the spouse in the caring role may be faced with having to return to work after many years outside the job market.  

Another common situation is where the spouses have planned early retirement, but the separation and divorce have made this unaffordable for one or both of them. 

Earning Capacity

The earning capacity of each person is an issue which the judge must take into consideration when making a decision in connection with an application for financial remedies on divorce. Therefore, this should also be taken into account when attempting to settle the case by agreement.

The respective earning capacities of the spouses are clearly relevant to the issue of whether one person should pay maintenance to the other. However, earning capacities are also relevant to the overall capital settlement, including whether or not a pension sharing order should be made. 

The court will expect both spouses to maximise their earning capacities. The court is generally unsympathetic to wives without young children who claim that it is not possible for them to obtain any form of paid work outside the home. The court views with scepticism the husband who has been in employment throughout the marriage but claims that he is now at risk of redundancy or the husband who has always received a healthy bonus but claims that it is unlikely that he will do so this year.  

Mortgage Capacity

Earning capacity directly affects a person’s ability to obtain a mortgage and make the  monthly repayments. During the course of a financial remedy case, you will usually be expected to produce evidence from a mortgage advisor of your ability to raise a mortgage, the level of that mortgage and affordability of the repayments. The more you earn, the greater the mortgage you are likely to be able to obtain.  The more money you are able to raise via an affordable mortgage, the less capital you will need in order to purchase suitable alternative accommodation. 

The Court’s Approach

Having said all of the above, the court does take a reasonable approach. It does normally acknowledge that a spouse who has not worked for many decades will need a period of time to adjust to their new financial circumstances. If that spouse has no qualifications and no recent work experience, the court will normally accept that their earning capacity is limited to an entry level job. It can be very daunting returning to the workplace after decades of working in the home. Many spouses in this position find it helpful to consult a careers coach.

Nadia Patel, coach at Nadia Patel Coaching www.nadiapatelcoaching.com says:

“Returning to work after a long career break can feel overwhelming, particularly for those who no longer see themselves as professionals or have lost confidence after years out of paid employment. Regaining that confidence is key. Many people underestimate the transferable skills they’ve developed through managing a household or raising children. With the right support, it is entirely possible to rebuild self-belief, recognise your strengths, and reconnect with your earning potential. At Nadia Patel Coaching, we help clients gain clarity, create a new vision for life after divorce, and take practical steps toward re-entering the workforce with confidence.”

Compensation

The court is able to consider financial disadvantage caused by the marriage as a result of decisions taken by the couple for the benefit of the family e.g. the sacrifice of a career. However, the court only applies this principle in very exceptional circumstances.  

Capitalisation of Spousal Maintenance

For a spouse who wishes to bring the obligation to pay maintenance to an end sooner rather than later because, for example, they would like to retire, they could consider capitalising the other spouse’s maintenance payments i.e. paying the other spouse a one off lump sum to bring the maintenance payments to an end. The appropriate lump sum will be calculated according to the level and period the maintenance is payable for, with a discount applied to take account of the early payment. 

Retirement

If one or both spouses have significant pensions, the court’s approach will be to redistribute the pensions in order to achieve equality of income between the spouses upon retirement. This will normally be done by way of a pension sharing order.

This will reduce the necessity for maintenance to be paid following retirement.

Conclusion

The best way to approach these issues is to make a detailed plan for the future, taking all of the relevant financial considerations into account. If possible, attempt to do this with your spouse. Your family law solicitor will be able to help you to do this in a realistic way. 

If you have any further questions about your divorce and how it will affect whether you have to work or not, please contact our Head of Family Law, Joanna Toloczko on 07756 288621 or at Joanna.Toloczko@bbslaw.co.uk or any other member of the family team.