24 Feb 2021
Women in general have already been disadvantaged in the ongoing pension equality struggle. They earn less and contribute less towards a pension. And then there is also the added issue of taking time off work to care for children or family members, which allows for fewer contributions than men.
In the past, women relied on their spouses for their retirement security, but with an increase in the divorce rate and single parent families, women are not able to look after themselves at retirement.
During divorce, couples often focus on splitting property and savings, and pensions are forgotten about. Women prefer to keep the primary residence as it provides security for the family. But what they forget is that pensions could also be part of the divorce settlement. Splitting pensions could provide the much-needed income for women when they retire.
It is up to the spouses to decide if they want to include any pensions into the settlement. This is a very complex process and often easier to offset the potential future value of the pension contributions against other assets e.g. getting a bigger share of the family home in return for your ex-partner keeping their pension.
Besides ensuring that retirement assets are distributed fairly, there are also other factors that women need to consider.
Tips to consider when the divorce settlement is being negotiated.
The path of divorce is one of emotional struggle and frustration for most. Ensure that you speak to your financial consultant to help make sense of pensions, taxes, and new legislation when it comes to dividing assets during divorce. [email protected]
*The above article is based on UK divorce settlements
Please note, the above is for education purposes only and does not constitute advice. You should always contact your deVere adviser for a personal consultation.
* No liability can be accepted for any actions taken or refrained from being taken, as a result of reading the above.