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Pensions and Divorce

Pensions and divorce overview...

After the matrimonial home, a pension fund can be the second largest asset owned by a family. A pension plan is usually valued in terms of its transfer value at the time of any divorce proceedings, and is valued in that way either to be shared or offset any assets awarded to either partner. It is not always prudent to assume all assets will be divided in “half”, and in many cases that does not occur.

A partner who has sacrificed their income in the course of a partnership, to care for children being one example, could expect to benefit from any pension earned by their partner while the relationship lasts. In the case of divorce, however, this would no longer be the case, and hence the fate of any pension accrued will have to be decided either between the partners or via legal proceedings.

Over the last 10 years the law has changed regarding divorce and pensions. The courts consideration of financial matters within the divorce agreement must now include pension schemes provision. Furthermore, three measures have been introduced in an attempt to provide a greater flexibility and choice for both the divorcing couple and the courts themselves, these are as follows:

Offsetting - Any pension benefits held by the couple are off set against any other assets.
Earmarking - A specified amount of the member's pension and/or lump sum is payable to the ex-spouse.
Sharing - The pension and the pension rights are shared between the couple. This is suitable for members of occupational, personal or stakeholder pension schemes. Pension sharing is not compulsory and does not apply, in the same way, to the basic State Pension.

How our service can help you...

We work with Eden Personal Financial Planning who can offer you the benefit of Independent advice from experienced and qualified pension advisers who are able to consult with you about your pension options if you are going through a divorce offering you comprehensive impartial advice either face to face or direct without any obligation. Their service offers: