Whilst most divorce settlements involve splitting assets like houses, shares and superannuation, what happens with frequent flyer points?

With the rise and rise of customer loyalty programs, it is common for frequent travellers to have hundreds of thousands of frequent flyer points. Points that allow them to travel the world business and first class frequently whilst checking into the finest hotels too.

Can they be valued?

The truth of the matter is frequent flyer points are very problematic when it comes to divorce settlements primarily due to the fact they are difficult to value, with Judges having difficulty agreeing on the issue. Points carry different weighting for different things with the most value coming from redeeming first and business class seats. On the other hand, redeeming points for gifts can be six times less value than the flight upgrades.  You can see the problem right?

frequent flyer points in divorce settlement

Frequent flyer points are an asset under family law proceedings and can be included as part of a person’s assets, even if not transferable.

 

Can they be transferred?

Whilst Australian courts are yet to hear a leading court case dealing with frequent flier points, an important first step in a divorce settlements is to determine firstly if frequent flier points can be transferable and in what circumstances.  This depends on each airline’s policy with Qantas for example allowing points to be transferred but do not mention what happens during divorce settlements.

What we do know is frequent flyer points are an asset under family law proceedings and can be included as part of a person’s assets, even if not transferable.  For example you might have $50,000 worth of points in your name that you are reluctant to transfer so I could ask for $50,000 from you through another asset that is easier to transfer such as shares or property.

Can they be used up prior to a divorce?

Using up and giving away points prior to a divorce can and is another problem however emergency proceedings can be taken to stop this happening, along with any other assets.

So, as you can see frequent flyer points are a complicated asset to value and include in property settlements however with careful analysis, it is possible to reach an outcome favourable to both parties without losing your luxury travel benefits.

Do you need a lawyer to help you with your divorce proceedings or provide you with independent legal advice? We are available after hours and provide home visits to fit around your busy schedule.

Last updated on April 9th, 2019 – Written by Jeremy Maspero.

Jeremy Maspero is a family law lawyer with a diverse range of experience and skills. With the experience you need and results you want, contact Jeremy today for a consultation to understand how he can help you on 02 8052 3322 or jeremy@masperolegal.com.au.


Disclaimer: The legal content on this website is produced by lawyers at Maspero Legal. It is offered for general interest only and should not be construed as specific legal advice as every situation is different. People seeking legal advice relevant to their particular situation are encouraged to contact a lawyer from Maspero Legal.