What happens to your pensions when you get divorced?
Throughout a marriage both husband and wife will have worked on the basis that on retirement they will both enjoy spending the lump sum they will receive on the retirement of one, and the income from that pension. If the marriage ends, however, they are no longer entitled to a lump sum on the other’s death or retirement or to the income from the other’s pension.
It is often necessary then, on divorce, to try and balance out this potentially huge inequality. There are various ways to achieve this which are:-
- By payment of spousal maintenance, which ceases when the owner of the pension dies
- Pension earmarking orders (which again ceases when the owner of the pension dies)
- Pension sharing orders
- One-off payments to help the one with lesser pension provision to offset the loss of their interest in the other’s pension scheme on divorce.
Valuing a Pension
This is an inexact science but the Courts and Solicitors generally rely on Cash Equivalent Transfer Values. We recommend that you request this from your Pension providers as early as possible as it can take some months to obtain this.
Pension Sharing
Within divorce proceedings the Court can make an order providing that a share in one party’s pension scheme can be paid into a pension scheme set up for the other.
Offsetting
A Pension scheme is one of several assets in a marriage. If one party to the marriage keeps their pension it may be appropriate for the other to keep a higher percentage of the other assets in the marriage, to provide them with alternative resources on retirement.
The significance of pensions in divorce varies depending on the length of the marriage, how close the husband and wife are to retirement, and the difference in value between their respective pensions. Pension sharing orders are just one of the options open to the Court and the parties when deciding on a fair overall settlement.
Neves Family Law Solicitors offer a fixed fee meeting. If you are facing a relationship breakdown and need some advice on divorce, separation or pension sharing talk to us on 0330 0945 500, email family@nevesllp.co.uk or complete our Contact Form and we'll get back to you.
Neves recently undertook our conveyancing and did an excellent job; the communication from Charlene Shillingford and her team throughout the whole process was top notch - I don’t recall being kept so up to date during the selling and buying of a house before. Queries were handled quickly and with the minimum of fuss, even when ‘the other side’ were being ‘difficult’. I’ve no reservation in recommending Neves. My heartfelt thanks to Charlene and the conveyancing team for their diligence and care during what can be a fraught time.
Beth Woodward, I wanted to say thank you for supporting me on my recent divorce. Faced with one of the most aggressive and unpleasant legal firms in London, you led me through both the family and financial divorce courts and more than achieved every one of my goals for the divorce. Most importantly, I have equal time parenting with my two girls and a really fair settlement so I can support them financially, both not even remotely offered by the other side. You listened and supported me when I really went for it, kept me sane through the FDR and court visits and also gave me the tough messages when I need to hear it. Thank you, I can’t quite explain how we did it, but we did 😊 😊 😊 😊
Emily has supported me through a divorce with excellent advice and guidance at every stage. All issues and options were explained clearly and fully. Possible outcomes were fully outlined to me throughout the process. Emily's professionalism has been of the highest standard. The kind and understanding manner in which Emily has supported me at all stages of the process is something that I am extremely grateful for. I literally felt the pressure shift from my shoulders. This is why I give 5 stars for the assistance I received.
I left this review for a few months as I wanted to let everything settle down and get my own head space back. On behalf of myself and my family, I just wanted to express our heart felt thanks to Beth for navigating us through a difficult divorce and parenting matters. Perhaps a little unconventional because as a dad, my teenage daughter wanted to remain living with me and yet I was also the main earner. We trusted Beth to give us timely, clear and succinct advice, help challenge tactics from the other side and understand the needs of my daughter whilst protecting my independent assets. We are so pleased with the outcome of the issues and all of the initial objectives were met. Beth, the whole of my family (children and grandchildren too) cannot thank you and your team enough. We have our home and family life back, fun and normality have resumed and a lunatic puppy is in place to help us heal and grow. Having trust in professional people is crucial at such a difficult time in life, and feeling that you have a solicitor of such high calibre took some pressure away when it was hard to deal with everything else. There were times that I felt Beth carried me through the process and times where I almost asked you to make decisions for me. It is a messy process, people get hurt and tears flow but thank you for your professionalism and understanding.
Neves were fantastic with my shared ownership purchase. What I particularly liked is their attention to detail ensuring my interests were protected, sound and trustworthy advice. Thank you to Charlene and Jackie who provided exceptional service. I have already recommended Neves to my friends and family.
