Divorced women are losing out on £5 billion pounds every year because they are unaware that they are entitled to a share of their husband’s pension.
According to a recent press release from Scottish Widows, 70% of couples who divorce don’t even consider pensions. We can understand why. Thinking about saving for the future and old age is, quite frankly, a bit boring. It’s even lower down on the priority list for someone going through a relationship breakdown. We often find that our clients’ immediate priorities, quite understandably, are where they will live, how they will provide for their children and what the impact of the separation might be on their standard of living.
The damage caused by not giving proper attention to pensions on divorce can be dramatic. A divorced spouse can end up without adequate provision for their retirement and have no way of claiming a share of pensions later on. It’s even more important given that pensions are usually the second most valuable asset of a divorcing couple, after property. It is a concern that nearly 50% of women surveyed in the YouGov poll said they had no idea what happened to pensions when a couple gets divorced. Nearly 20% assumed that they simply kept whatever pension they might have in their own name.
When it comes to dividing pension on divorce, there are a number of options. The two main options are:
|A pension sharing order||A share of one person’s pension is moved into a separate pension pot for the other spouse at the time of the divorce.|
|Pension offsetting||This is where some cash savings, a greater share in a property or some other capital is given to the receiving party, instead of pension.|
It is important that you choose a solicitor that will keep your best interests front and centre at all times. During such a difficult time, you want to be able to place your trust in someone who will think about the important things (as well as the boring things) and who will point you in the right direction so you get the best possible results.
If you would like to discuss the matters raised in this article, or any other family and divorce matter, please contact Dominic Wisdom on firstname.lastname@example.org or call 01494 478604.