When couples separate, one of the most important questions for them is how their financial “needs” will be met in the short and long-term. The term “needs” is repeatedly referred to, but it is not always clear to clients what it really means in practice.
The court’s first responsibility is to ensure that the needs of any children are met. After that, the focus turns to the adults and how each will manage financially after the divorce.
What “needs” means in practice
Meeting “needs” is not just about covering basic living expenses. It involves thinking carefully about what it will take for both parties, and especially any children, to live securely and fairly after separation.Housing is the most obvious example. Both sides need somewhere to live, and children need a stable home base. In many cases, both parties will have the same basic needs for housing and income.
Mark Studdart, a Partner in the Family Team at Gordons Partnership, explains that ‘meeting needs’ is “generally looking at three areas: housing and capital needs; income needs; and future income needs, which often means pension provision”.
The court looks at what is reasonable given the circumstances. It is not about providing luxuries, but about making sure that everyone can move forward without hardship.
The role of Section 25
The Matrimonial Causes Act 1973 requires the court to apply the criteria set out in Section 25 when deciding financial remedy disputes. When it does so, it pays particular attention to needs. The main focus is always on the current and future assets and resources of the parties, and how those can be used to address the needs of both the parties and any children both now and in the future.
This means judges are not only interested in what exists today, such as a house or savings, but also in what resources might be available tomorrow, such as income or pensions.
Why children’s needs come first
The welfare of any children is the court’s top priority. Their housing, education, and day-to-day support are considered before anything else. This reflects the idea that children should not suffer financially because their parents’ marriage has broken down.
In matters where there are limited assets the Court may prioritise the housing needs of children via the parent with the main day to day care of the children, and defer the other parent’s share of the assets to a later date.
Balancing the adults’ needs
The court considers what each adult reasonably requires to live and to meet their own commitments. That may mean one person has to make ongoing payments to the other party, or that property or pensions are divided in a way that ensures both can manage now and in the future.
The goal is not to make both parties equal in wealth, but to achieve a fair outcome.
Why “needs” vary from case to case
There is no set list of what counts as a need, and no fixed figure for how much is enough. The court has wide discretion to decide what is fair in the circumstances. Much depends on the standard of living during the marriage. Hence there is a socio-economic aspect to considering relevant needs.
For example, Mark suggests that “There isn’t a fixed definition of “needs”, it’s an elastic concept, and it reflects another of the criteria: the standard of living during the marriage. For example, a family worth millions will have greater housing costs than a typical family, so one might “need” houses worth £2m and the other family houses worth £200,000…None of the factors are absolutes; it’s all a balancing act”.
The same law applies, but the outcome changes depending on the facts in each individual matter.
The sharing principle
The sharing of pensions and distribution of other assets also sit within the broader concept of sharing. Most cases are driven by needs, because the combined assets are just enough, or not quite enough, to meet all the financial requirements of both parties and their children. But where there is an excess of funds over needs, the surplus is shared equally. The reasoning is that wealth accumulated during the marriage – what judges often call the “fruits of the marriage” – belongs equally to both, regardless of who earned it. As Mark points out “The sharing principle is something you won’t find in the statutes in the Matrimonial Causes Act – it’s a judicial concept developed in case law, but has become hugely important especially in so-called Big Money or High Net Worth cases”.
Non-matrimonial assets and “mingling”
Not everything is automatically shared. Non-matrimonial assets are often excluded. Mark explains that these can include:
- Assets brought into the marriage (pre-owned property or savings)
- Assets inherited during or after the marriage
- Assets accumulated after separation
Typically, these are kept separate, unless they become ‘mingled’ into family life. Mark presents a good example of mingling “when someone owns a property, the parties move into that property, and it becomes the family home for a substantial amount of time. Maybe they then leave it and go buy another property, but they continue to rent out that property, and they use the rent to meet the needs of the family. So it’s then gone from maybe being a solely owned non-matrimonial asset to being a jointly used asset and thus “matrimonialised”.
These arguments about mingling can be complex and costly, particularly in high-asset cases where the stakes justify prolonged disputes.
The importance of professional advice
Understanding what counts as a financial need and how the court is likely to view it is not always easy. This is where legal advice matters. Lawyers bring experience of how judges apply the law in practice. They can identify which arguments will help and which are unlikely to succeed.
The value of legal advice lies in giving proportionate and sensible guidance about what a fair outcome might look like. That means helping people focus on what the court will consider essential, rather than being distracted by points that do not carry much weight.
Moving forward with clarity
For many separating couples, needs are the heart of the case. They define what is possible and what must be prioritised. By understanding how the court approaches this question, people are better placed to prepare for the future.
At Gordons Partnership, our aim is to make this clear from the start. We explain what the court looks for, how children’s interests are protected, and how adult needs are balanced. With that clarity, clients can face the process with greater confidence and less uncertainty.
About the Author
Partner
Tel: 01483 451 900
Email: Mark@gordonsols.co.uk