Pensions Advice for Silver Splitters

Posted on: 3 mins read
Lorraine Harvey Profile Picture
Lorraine Harvey

Partner, Family Law

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Silver Splitters is a term used heavily in the press to refer to people who are getting divorced later in life. The divorce process means the ending of a marriage but if you are going through this, you also need to arrange a financial separation too. This process becomes a little more complicated if one of you is already drawing from a pension scheme.

We know it can be a sad and also a stressful time when a marriage ends and there are lots of things to clear up. When you are looking at the financial side of things, pension schemes you or your partner are part of sometimes get overlooked by you, but they are very important in terms of affecting the income you will receive in the future.

When Pensions are assessed in these cases, they are rarely split 50/50 and there are certain things that need to be considered.  In this article we will talk more about the situation if you are a so called “Silver Splitter” and how our team of Family Law Solicitors can help you.

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It is always best to try  to negotiate things amicably with your former partner as much as you can but if that isn’t possible there are several options open to you. First of all, you should make sure that you are aware of all the pensions that each of you have. In today’s world it is not unusual for someone to have several different pensions with different providers. All of these need to be taken into account when deciding your options. If you fail to disclose all of your financial assets when a Financial Order is applied for, you could face costly legal action further down the line as well as having to have a new updated Financial Order arranged.

Pension Sharing Orders

If only one of you has Pension assets, then you could apply for a Pension Sharing Order. This allows a Court to award a percentage of one person’s pension total to the other. If you are the person receiving this amount, then it would have to be placed into a pension scheme that was in your name only. This is the most common option that people who divorce later in life use.

Pension Offsetting

If you choose this option each partner keeps their own pension but the value of it is offset against other assets the couple own. For example if one of you has pension funds that add up to a high amount and the other partner doesn’t, they may receive the couple’s home, to make up the balance (to make each total of similar value). ‘Silver Splitters’ need to be more careful about this option as you should always think ahead to what your income is going to be in later life. Owning a property you live in would not give you the regular income a pension payment would.

Pension Attachment Order

Choosing this option means you need to wait until your former partner retires and draws their pension. This order allows you to receive part of the income (or lump sum if that’s what they choose to take). However, there are several risks with this type or order. If you decide to remarry before your ex-partner begins to take their pension, you will no longer qualify and receive nothing. If your ex-partner passes away before they draw their pension, then your share of the future monthly payments will also be lost.

It is very important that you obtain expert legal and financial advice when dealing with these matters as it can be a complex area of the law. We always advise obtaining a Financial Order before your divorce goes through and this is where our team of Family Law Solicitors can help.

Our friendly team can help you with both the divorce process and arranging your finances to make sure you are protected from any future challenges going forward. Get in touch and let’s talk about how we can help you.

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