Not discussing pensions is an area that solicitors say is neglected when couples go through a divorce. According to Which, two thirds of divorcees have not discussed pensions which can be a huge mistake.
Going through a divorce can be a stressful and upsetting process, but making sure you have done your research and know what areas are important to think about can really pay off in the long term.
Other mistakes divorcees make include paying for unnecessary legal fees, not checking if you are eligible for financial help with fees and not updating your will.
According to the Office for National Statistics, pensions are often the biggest asset for divorcing couples and make up to 42% of household wealth.
In order to assess how much your pension is worth when going through a divorce, you should get a pension valuation. Financial advisors can check these figures are right and can also help you pick the best way to share the pension.
There are a number of ways in which a pension can be dealt with in a divorce. Firstly, there is a pension sharing order which means a percentage of one person’s pension is transferred to the other.
Alternatively, there is pension offsetting which is when one person keeps their pension in exchange for giving up another asset such as a family home. Or, there is the option to have a pension attachment/earmarking order which is when one person pays an income or lump sum to the other when they start taking their pension.
Liza Gatrell, Team Leader Partner at Stowe Family Law, said: “If you are discussing potential financial settlements with your ex partner then early specialist legal advice is invaluable because the law is discretionary and not easy to navigate. You need to ensure that your settlement parameters are fair and can be enforced.”
Other mistakes divorcees make include paying for unnecessary legal fees, not checking if you are eligible for financial help with fees and not updating your will.
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