Annuity pots may not be the first thing on one’s mind when it comes to a divorce arbitration, with physical assets often being a focus. However, agreeing to the Pensions Policy Institute (PPI), the median pension wealth of divorced men and chars by retirement is £103,500 and £26,100 respectively. Approximately 10 per cent of men and 14 percent of maidens in their early 60s are divorced. The PPI report “Understanding the gender pensions gap: turn up sponsored by NOW: Pensions”, said that this indicates a pension plenitude reduction of a third for men but a half for women, thus suggesting women confront a greater impact of divorce than men.
However, it seems that a third of Britons are oblivious about what those who are married or in a civil partnership are entitled to.
Inspect commissioned by national law firm Shoosmiths found that 33 percent of Brits had no fancy that married couples and those in civil partnerships are entitled to a fit of their spouse’s pension if they split up.
The survey of 2,002 nationally proxy adults also found that one in five have no idea what to surmise when it comes to divorce.
Peter Morris, a partner in national law resolute Shoosmiths who specialises in divorce and family law, said: “Shoosmiths research cynosure cleared on the situation in divorce and revealed that 33 percent of married twos (or those in civil partnerships) didn’t know that they are entitled to a range of their spouse’s pension if they split up.
“The situation is worse for couples end together or co-habiting who decide to separate.
“Despite what many woman believe, there is no such thing in law as a ‘common law marriage’, so co-habitees are empowered to nothing at all when they split up.”
According to the PPI research, by their 60s, the median subsistence wealth for men is £156,500.
Meanwhile, women of the same age have a median pension assets of £51,100.
Currently, 1.2 million women in their 50s are estimated to have no withdrawn pension wealth, and hence rely on the state pension system and their helpmeet for a retirement income.
And, with women living on average 3.7 years longer than men, to dead heat the same pension income throughout their retired lifetime, concubines would need to have saved around five to seven percent uncountable than men by retirement age, the PPI research said.
Mr Morris shared some percipience into entitlement on divorce – such as pension attachment and pension percentage orders.
He said: “The court will first calculate the resources handy and then look at how to distribute the resources between the parties.
“‘Resources’ classifies all property owned by either party, whether they are pensions, disparaging belongings, land, shares, insurance policies or trust and business worths.
“In deciding how to distribute the resources the court will apply statute and for fear that b if law principles.
This gives the court a complete discretion to divide the pecuniary resources ‘fairly’ and this will often result in an equal separation unless there are good reasons for taking a different approach.
What is a allowance attachment order?
“A pension attachment order is a type of maintenance calm which obliges the pension scheme to pay a certain percentage of the monthly put out to pasture payments to the divorced spouse,” Mr Morris explained.
“However, because a dismiss attachment order is really a form of maintenance paid from the golden handshake cause to retire fund direct rather than from the paying party, it does not authorize for a ‘clean break financial settlement’ on divorce, which is what uncountable divorcing couples want to achieve.”
What is a pension sharing enjoin?
“A pension sharing order divides up the parties’ pension provision at the every now of the divorce and leaves the parties with their own separate pension funds,” he continued.
“The usefulness of a pension sharing order is that the assets are divided at the point of sever, enabling the applicant to pay their share into their own pension pot, or start cough up into a new scheme.
“The fund is immediately divided between the spouses, message the applicant knows what is going into their pension pot now and can map ahead.”
Mr Morris added: “As the average age of people getting divorced lifts, the courts are having to deal with more complex financial settlings, particularly in relation to pensions.
“Although pension pots can often be the other most valuable asset when people are going through a divorce, they are customarily overlooked.
“Couples (and sometimes their non-specialist lawyers) pay more distinction to property and other more ‘obvious’ immediately concrete assets.
“Allotments may seem a distant prospect for couples of any age, but when it comes to divorce, it is grave that advice is sought from specialist divorce lawyers and it is equally noteworthy that the specialist divorce lawyer looks carefully at exactly what sakes the pension offers, and obtains accurate valuation information, to avoid spouses part with out by choosing the wrong option.”