What Is A 60/40 Split In Divorce? 

What Is A 60/40 Split In Divorce refers to the partition of assets in which one party receives 60% and the other receives 40% of the marital assets.

This division of assets is not predetermined or standardised under Australian law; it depends on the particular circumstances of each case.

Section 79 of the Family Law Act of 1975 specifies the procedure for determining divorce property settlements.

Why Courts May Favour a 60/40 Split Instead of 50/50

While a 50/50 split might initially seem like a fair starting point, it is rarely the final outcome.

The Family Court assesses each party’s unique contributions and ongoing needs, including health, age, financial circumstances, parenting responsibilities, and earning capacity.

If one person has stepped back from their career to raise children or care for the family, that is treated as a substantial non-financial contribution.

A 60/40 split might result to account for future financial hardship or inequality that could follow separation.

The court’s goal is to ensure both parties are positioned fairly after the relationship ends, not simply to divide assets evenly.

Can You Negotiate a 60/40 Split Without Going to Court?

Yes. A 60/40 division can be agreed upon through out-of-court negotiations, especially when both parties seek a faster and more cost-effective resolution.

This may be documented in a Binding Financial Agreement or finalised through Consent Orders approved by the Family Court.

Legal guidance is essential to ensure the terms are enforceable and reflect a fair outcome. Negotiating outside of court also allows more flexibility and privacy, which many couples prefer.

However, it is important that both parties provide full and honest financial disclosure when coming to an agreement to avoid complications later.

What Is A 60/40 Split In Divorce, And How Is It Computed?

Let’s establish a hypothetical divorce settlement in Australia, where the property is divided 60/40.

Please remember that this is a simplified example, and actual cases may be significantly more intricate and complicated, requiring legal counsel and court decisions.

60/40 Split Example Scenario

A couple is divorcing after 20 years of marriage. They have two children, aged 15 and 17.

Their total assets amount to AUD 1,500,000, which includes their house, cars, savings, investments, and superannuation.

They also have a mortgage on the house of AUD 300,000 and credit card debts totaling AUD 20,000.

Step 1: Identify the Asset Pool and Deduct Liabilities

The couple’s total combined assets amount to AUD 1,500,000.

Their total liabilities (the mortgage and credit card debt) amount to AUD 320,000.

The net asset pool would thus be AUD 1,180,000 (1,500,000 – 320,000).

Step 2: Assess Contributions

Assuming both parties contributed equally during the marriage, both financially and non-financially, an initial 50/50 split of the net assets seems reasonable based on their contributions alone.

Step 3: Consider Future Needs

The wife has been a stay-at-home parent for the past 10 years and will be the primary career of the children post-divorce.

She has lower earning potential and a greater burden of care. The court may therefore adjust the initial 50/50 split to consider these future needs.

Step 4: ‘Just and Equitable’ Adjustment

The court determined that a 60/40 split in favour of the wife would be just and equitable, considering her lower income, job prospects, and the fact that she would be the primary carer of the children.

Final Calculation:

So, the final division of assets to know the answer to the question: What Is A 60/40 Split In Divorce would look something like this:

Wife: AUD 1,180,000 * 60% = AUD 708,000

Husband: AUD 1,180,000 * 40% = AUD 472,000

 

Can My Wife Still Claim on My Future Earnings After the Finalisation of Divorce and Property Settlement? 

Once a property settlement has been finalized – whether through a Binding Financial Agreement (BFA), Consent Orders approved by the Family Court, or a court order following litigation – neither party can typically claim the other’s future earnings.

A property settlement aims to establish a clean financial separation between the parties.

It involves contemplating future requirements, such as child care, age, health, financial resources, earning capacity, etc., at the time of settlement.

This is considered when determining the percentage distribution of the asset pool.

Does The Law Always Take The Side Of The Housewife In Property Settlement? 

No, the law does not always favor the housewife, or any party, in a property settlement.

In Australia, the Family Law Act 1975 establishes the framework for property division upon separation and divorce, and it does not inherently favor one party over the other based on their role as a housewife or breadwinner.

The law instead requires a just and equitable division of assets. It considers various factors, including the direct and indirect financial and non-financial contributions made by both parties during the relationship and their future needs.

Suppose one party, for instance, the housewife, has a lower income-earning capacity and greater childcare responsibilities. In that case, they might receive a larger portion of the assets to offset these future needs.

Both parties are required to provide full and transparent financial disclosure to both their former spouse and the court during divorce or separation proceedings. Concealing assets during a divorce carries serious consequences.

 

Unsure What Is A 60/40 Split In Divorce? 

Wondering whether a 60/40 split might apply to your situation? The team at Justice Family Lawyers is here to help you understand your rights and entitlements.

With a deep understanding of the Family Law Act and property division principles, we can support you in securing a resolution tailored to your circumstances.

Contact us today for professional guidance grounded in experience and clarity.