Splitting with one partner to start a new life with another could cost more than people imagine, suggests a new report from Standard Life. Its Real Second Life report claims that more than 8.5 million people in the UK risk savings, pensions and general financial security when they leave one partner to start a new live-in relationship.
Marketing manager, Andrew Tully, said: “Our research found that 15.5 million Brits would like to leave their present life and start again. For those planning a second life, it is crucial that they consider the financial implications, save where they can, and seek guidance – either direct from the provider or through a financial adviser.”
According to the financial services company, the average cost of the transition is approximately £20,000. Furthermore, 83 per cent of Brits affected said the financial implications of starting afresh with a new partner were as stressful, or even more stressful, than the emotional consequences.
Another worrying statistic uncovered by the report is that, at the end of a cohabiting relationship, one-third of 35- to 65-year-olds has no pension income at all. And, of those that did have a pension, 11 per cent either had to give away part of it, or received some of their ex-partner’s retirement fund.
Mr Tully said: “When going through an emotional upheaval like divorce or separation, pensions are unlikely to be at the forefront of people’s minds.”
“But it is crucial to be aware that starting afresh can have serious implications on your financial future; either by having to forfeit part of your pension to an ex-partner, starting a retirement fund from scratch, or beginning a new relationship with new financial responsibilities,” he added.
Standard Life advises people considering a relationship change not to take out their pension before they really need it and to make sure that old pension schemes have not simply been forgotten if they have changed jobs.
“Essentially, the bottom line is that the more money you can afford to save and the earlier you start saving in life, the more secure your retirement. With changing lifestyles and people living longer, this message has never been more important,” said Mr Tully.
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