In Singapore, for every 1,000 married males, there are 7.1 that are divorced. For every 1,000 married females, there are 6.6 who are divorced. While Singapore isn’t the country with the highest divorce rates in the world, divorce among married Singapore couples is still more common than we think.
While we hope that every family can stay intact, we know that the reality is harsh. What happens if your marriage is beyond repair and divorce is the only way to go? What do you need to know about your assets and money if you are contemplating about divorcing your spouse?
“Eligibility” for divorce
TV dramas always portray divorce to sound like such an easy process. But in reality, it is not just tedious, you also need to fulfil certain criteria before you can call for a divorce. For a start, you need to be legally married for at least three years before you can file for a divorce.
This is unless you can prove that you have suffered exceptional hardship or if your spouse is unreasonable or cruel.
You also need to prove that your application for divorce is based on “irretrievable breakdown”. “Irretrievable breakdown” can be backed by adultery, unreasonable behaviour, desertion or separation (with or without consent).
Cost of a divorce
The divorce procedure involves the intervention of professional family lawyers. Thus, there is always a cost when it comes to divorce. The cost involved in a divorce is dependent on how amicable the divorce turns out to be.
In an uncontested divorce where both you and your spouse are mutually agreeable to split, it will typically cost you anything between S$1,500 to S$2,900.
However, things will be very different if it is a contested divorce where you and your spouse are unagreeable to the terms of splitting. This is especially common when things like custody of children get into the picture.
To engage a lawyer to take care of the legal proceedings, you will need to pay legal fees that range from S$100 to S$450 per hour depending on the reputation of your choice of legal firm.
If your spouse is adamant on contesting everything from maintenance fees to assets, you can expect the cost of your divorce to be anywhere between S$5,000 and S$30,000.
How will your assets be divided?
According to the Women’s Charter, any assets that are owned by either party needs to be divided between the two of you. These assets can be the matrimonial home or other property and shares or other investments.
They can also include money invested in pensions or in a business. They are known as matrimonial assets. However, this does not mean that the assets will be split into two.
The Court will judge how much to ascribe to each party based on both financial and non-financial contributions. In most cases, it will take a lot of consideration from the Court to decide how to split the matrimonial assets between you and your spouse. These considerations include:
1. The extent of financial contributions towards these assets
2. The extent of non-financial contributions towards the welfare of the family
3. Debt owed
4. The needs of the child
5. Any prenuptial agreements towards the divisions of assets
6. The financial independence of each party after divorce; and
7. The needs of each party after divorce
That being said, there isn’t a fixed formula to the division of matrimonial assets. It is dependent on the circumstances of each case and varies from case to case.
Have more questions about matrimonial assets? We answer some of them below.
1. Matrimonial home
Like most couples in Singapore, your biggest asset post marriage is probably the house or HDB flat you purchased or were gifted. A matrimonial home is defined as the home (whether gifted or purchased) where you lived as a couple after marriage. Now that you are heading for divorce, your home will have to be divided.
Q: Can I keep the HDB flat after divorce?
You can retain the flat if the following situations apply to you:
· The names of your parents are listed on the original application of the flat. If not, you have to obtain HDB approval and then sell it on the prevailing market price.
· If the court has given you the custody of the children.
· If you have no children, are over 35 years and have occupied the flat for five years or more, you can retain the flat under the Single Singapore Citizen Scheme.
Q: How will the proceeds of my HBD flat be divided?
If your divorce leaves you with no other option except selling your flat, you can work out a ratio with your spouse before sending the request to HDB. But if you are not able to agree on the percentage to be divided, the matter will be settled in court.
Q: I used my CPF savings to buy my flat. What will happen to it after divorce?
Following the sale of the flat, you will have to refund the principal CPF amount you withdrew along with the accrued interest. If the sale of the flat at a fair market value is not enough to pay back the amount owed to CPF, you do not need to top up the shortfall with cash.
If the Court rules that a transfer of your share of the property to your spouse should take place, it is possible that there is a partial refund to your CPF account or none at all.
2. Joint bank accounts and shared debts
Once you have decided to call it quits, it is a good idea to open a new bank account and begin depositing your earnings there. If you have most of your savings in a joint bank account with your spouse, tread cautiously while withdrawing money from there.
As your lawyer would advise, withdrawing your share of savings without finalising an agreement with your spouse, could be detrimental to your case in court. If you own joint credit cards, you can close the account jointly.
This, however, will not be possible if you have racked up some debts. In that case, you may have to discuss with your spouse on how to repay the debt. If things are rocky, try to lower the credit limit and run a tight ship till the debt is repaid.
3. Maintenance fee for spouse
According to the Women’s charter, a court can order a man to pay maintenance to his wife during or after divorce proceedings. This fee is arrived at after taking into consideration various factors.
These include the wife’s salary and assets earmarked for her during the division, their financial responsibilities towards children, the standard of living, contributions made towards family expenses and future earning capability. This sum is either paid in monthly instalments or as a lump sum.
Q: What if the wife earns significantly more than the husband?
The court may award a small sum or none as maintenance fee to her from her husband.
Q: Can the husband ask for maintenance from his wife?
Yes, he can. Thanks to an amendment in the Women’s charter, a man can claim maintenance from his to-be-ex-wife. He can claim this amount if he suffers from a physical or mental disability and is unable to earn and support himself because of that.
4. Maintenance fee for children
What’s harder than divorce? Having children in the middle of all the mess. No matter what the situation is with your spouse, it is of utmost importance to ensure that your child, already upset with the new development, isn’t distressed further.
Legally, till your child is 21 years old, he or she is entitled to child maintenance irrespective of whether it is a biological child or not. If the child stays with a non-earning parent, the providing parent is obliged to make payments as stipulated by the court.
Q: How is the maintenance fee calculated?
The court takes into account several factors before narrowing down on a maintenance fee. Some of them include:
· Standard of living of the family
· Financial needs of the child
· Earning capability of the parents
· Whether the child has a physical or mental disability
Failure to adhere to these regulations could lead to a fine or jail time for the offending parent.
In conclusion, be prepared for a messy affair
While getting a divorce might sound easy on paper, it is actually a messy and expensive affair. Sometimes, it can even be a heart wrenching one. For anyone who is contemplating to get one, you should at least be prepared, both mentally and financially.
This article first appeared on BankBazaar.sg, a leading online marketplace in Singapore that helps consumers compare and apply for financial products such as credit cards and loans.
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