Divorce and Pension Sharing We have a complete site dedicated to pension sharing and pensions in divorce negotiations. For advice on pension sharing visit Divorce and Pensions.com for more on this subject.
Getting divorced can be a complex matter and people are generally only interested in their financial well being at the time. During divorce you also need to think about your financial well being in later life. This is why there have been various changes in law to help divorcing couples and to ensure that there is an opportunity to look after yourself financially in later life - Pension Sharing.
A pension may be the single largest asset within a marriage, please be aware of this fact if your are divorcing.
Pension benefits are complex and yet for somebody who is in middle age or has been a member of a pension scheme for a long time it may be the single largest asset within the marriage and care, therefore, needs to be taken in how this matter is handled during divorce . The ideal aim within any divorce negotiation is obtain a clean break settlement. However, more frequently affairs are more complex and a simple solution cannot be found.
Men are four times more likely to have built up substantial pension benefits than women, according to the Department of Social Security in 1995. Women, generally speaking, build up smaller pension benefits than men as a number take career breaks to raise children etc. This may lead to financial difficulty in retirement.
The law has therefore developed to allow assets to be distributed fairly during divorce. It may be that pension benefits remain as they were but the party with little or no pension benefits receives a greater share of the other assets from the marriage. This is known as offsetting.
Other ways to distribute pension assets during divorce are to earmark (technically reserve) pension benefits for the other party or more recently to be able to share the benefits (divide the pension and transfer the benefits into a separate, identifiable pension pot), Pension Sharing.
In pension sharing if you are the party who has to give up part of your pension rights you may be able to make up this shortfall in your pension by making additional contributions.
To ensure that you are aware of your Divorce and Pension Sharing rights with regard to your own or your ex spouses pension visit our site Divorce and Pensions.com.