As the third lockdown kicks in, are tensions at home rising?
Family lawyers say divorce enquiries usually spike this week of the new year as a result of strained relations over the festive period, while divorce or the dissolving of civil partnerships started before the break, resume.
In all the confusion and distress, pension assets can often be forgotten and not taken into account in the final settlement meaning unfair financial results.
Lindsey Canning, head of Family Law at Wake Smith Solicitors in Sheffield, looks at how pensions should not be ignored, especially for women.
“Few people think about pensions when a relationship finishes. But, your pension could be affected by your change in status.
“Pensions are included as assets in divorce financial settlements, and it is important to understand your pensions entitlements and the impact of any settlement on their benefits.
“Without this, you may find that your pensions benefits may be significantly different than what you expect when you come to retire.
“It’s important to talk these issues through and to not make any assumptions about what you will get or be entitled to, without checking first.
“Pensions are often a couple’s most significant asset, after a house, and can easily be overlooked. Find out how much they are worth and think about how to divide them fairly. While there doesn’t need to be a pension sharing order, they should not be ignored when deciding how assets should be allocated.”
You and your ex-spouse or partner need to tell the Court the value of your pensions.
Lindsey added: “You cannot obtain details of your spouse’s pension benefits and value(s) directly from their pension provider(s) however both spouses have a duty to provide the other with financial disclosure which includes full details of pension benefits and values to enable your solicitor to get an understanding of the assets and, how these including pensions are best dealt with.
“It is very important not to overlook the mutual value of pensions, as it can help ensure any separation is more fair and equitable.”
You can ask your pension scheme administrator or pension provider about the value of your pension.
Lindsey added: “According to recent research from pension provider L&G, women are significantly more likely to waive rights to a partner’s pension as part of a divorce than men.
“Twenty-eight per cent would give up pension rights compared with 19 per cent of men, which could have a significant long-term impact, particularly as women tend to have less personal pension wealth, according to recent data from the Office for National Statistics (ONS).”
The data found that men currently below the state pension age have higher median active pension wealth than women by around £5,000 and for those aged 65 years and over, men's median pension wealth for pensions in payment is double that of women - £223,933 for men vs. £112,967.
Women were likely to see their household incomes fall by a third in the year following their divorce, almost twice as much as men, potentially as women are typically paid less, with 74 per cent of men likely to be the primary earner.
If you are considering the divorce process or want to end a civil partnership call the Wake Smith Family Law team on 0114 266 6660 for advice or email [email protected]
