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Why you MUST put pensions first when divorcing

wedding coupleDivorce is undoubtedly painful, particularly if it becomes combative. So it is good news that the government is looking at introducing no fault divorces which should mean that splitting up becomes more civilised.

So, fingers crossed that this bit of legislation goes through. I’ve never been divorced but I know plenty of women who’ve been put through the wringer by a marital split. And while of course men too can come out badly post-divorce, women can end up with a poor deal when it comes to money.

Part of the reason for this might be that pensions aren’t taken into account in divorce settlements. Charity Age UK is warning that many divorced women lose out on substantial amounts of money because they are not made aware of their legal entitlement to their husband’s pension pots on divorce. Currently, when couples end up in court to settle their finances on divorce there’s no automatic right to reveal the size of spouse’s pension pots or that pensions must be split as part of a settlement. Caroline Abrahams, Age UK’s charity director said: “It is extraordinary and frankly unacceptable that so any women are potentially missing out on significant sums of money when they divorce, sometimes without even realising they have lost future income which probably should have been theirs”.
he problem is that couples don’t discuss their pensions – so many women just don’t realise what they are missing out on. Figures from the Office of National Statistics show that men aged 55-64 have pension pots around three times the size of women of the same age. Women have smaller pension pots often because they’ve taken time off work for caring for children or elderly relatives. And of course, we tend to earn less than men.

So maybe it’s time for a chat with your other half. Even if you’re blissfully happy and will be together forever, surely it’s healthy for a married couple to know everything about each other – including how much money each has in pensions and other investments. Best to have everything out in the open, surely.

See our guide to pensions here  our guide to divorce here 

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Wednesday, 14 November 2018