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We are one of the few Forensic Accountants in the UK able to offer Lifestyle Analysis to people going through a divorce. You can access the service via a solicitor, barrister, mediator, IFA, or divorce coach, or by contacting us directly.

Divorce can be emotionally trying and confusing. The last thing someone, in the early stressful stages of the divorce process, will want to do is to spend hours pouring over documentation to produce detailed analysis and budgets of their assets/liabilities and income/expenditure. Often those involved will simply estimate or guess. Complete accuracy is of the utmost importance because this analysis will be used to determine the division of assets, maintenance and even child support.

Download the Lifestyle Analysis information sheet.

What is Lifestyle Analysis?

A Lifestyle Analysis is an analysis of each party’s income and expenses to demonstrate the standard of living during the marriage and to determine the living expenses and spending habits of each spouse.

Lifestyle Analysis establishes what the standard of living was in the last few years of the marriage and provides financial projections.

It will include an accurate tabulation of transactions in the records, reasonable estimates for items that may be missing from the records, and an overall evaluation of the quality and completeness of the records.

Who should prepare a Lifestyle Analysis?

Forensic Accountants have specialised experience and expertise in divorce finances and can support solicitors, accountants and financial advisors with complex financial analysis.

For example, it may be necessary to divide expenses between family members to determine which spouse or child benefitted from the expenditure. Analysis often gets complicated, so an experienced analyst is necessary to ensure completeness and uniformity in the analysis and calculations.

Analysis of expenditures to determine if any are unusual or non-recurring is required. Information known by one spouse may not be compatible with the level of expenditure reflected in the records, for example, significant improvements to the home during the period being analysed.

Types of analysis undertaken

Lifestyle Analysis reconstructs the day-to-day living expenses incurred during the marriage, and the spending habits of both the husband and wife, categorises them and calculates totals for each category for the period under analysis.

The expenses also need to be reviewed to determine if anything is missing, for example, mortgage payments or car payments, which might indicate that there is a misclassification or missing account statements.

Lifestyle Analysis can include the analysis of the following:

  • financial statements (bank, credit cards etc)
  • personal and business income tax returns
  • recurring and ordinary expenses within each category of expense (clothing, food, household, entertainment, travel etc)
  • unusual, non-recurring and/or seasonal expenses
  • annuities, pensions etc
  • loan applications
  • insurance policies, wills, trusts, safety deposit boxes
  • business valuations
  • certificates of title (property, homes, vehicles etc)
  • valuations (jewellery, artwork, collections etc)
  • credit reports
  • any discrepancies

In a business valuation, the business might have correctly reported income and expenses but significantly overvalued some of its assets.

Why is Lifestyle Analysis so important?

Lifestyle Analysis is critically important to the outcome of any divorce and may even be required by the Court. Solicitors will often just rely on information provided to them and assume that it is correct. If a spouse has not been truthful, they may lose credibility in the eyes of the Court.

A carefully prepared, comprehensive Lifestyle Analysis could make all the difference between a financially successful divorce settlement and one that is considerably less so.

Not only is it used to determine the division of assets, maintenance and child support, but Lifestyle Analysis is also used to get a picture of what funds are required to maintain a particular standard of living.

Ultimately the goal is to arrive at the most equitable distribution of assets possible and provide evidence to support the cost of supporting the lifestyle the parties are used to.

How can Lifestyle Analysis uncover hidden assets?

Each transaction from the bank, credit card accounts etc must be traced to determine where the funds went. It is important to ensure that all statements have been received and analysed, as one missing statement could hold the key to a hidden asset.

Indicators are:

  • Transactions with an unidentified or unusual origin or destination
  • Large cheques made out to cash
  • Significant cash withdrawals
  • Payments to unknown entities
  • Transfers to previously undisclosed accounts
  • Large cash transactions
  • Lack of documentary evidence to support an asset purchase

All explanations need to be verified. Even payments to legitimate entities need to be verified to determine whether a payment was due or was an intentional payment that the spouse hoped would not be refunded until after the divorce was settled.

A Lifestyle Analysis can be a valuable tool for uncovering assets one spouse has tried to hide or dispose of marital assets. It is not unusual during this process to discover that one party has been pursuing some nefarious activity, such as selling marital assets, concealing income or even supporting an extramarital relationship. The discovery of one hidden account may lead to others.

Hidden assets can be taken into consideration when the divorce settlement agreement and maintenance are finalised.

How can a Lifestyle Analysis find sources of income?

Lifestyle Analysis can help prove that one spouse is living a lifestyle that exceeds reported sources of income and is not explained through other cash sources such as loans, gifts or inheritance. It can also uncover bank deposits that are from a source of income not previously disclosed.



We provide prospective clients and their legal representatives with a FREE one-hour initial meeting anywhere in the UK.

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