Elderly divorcees could end up much poorer in retirement

With couples who get split often ending up worse off in retirement, pensions have become an increasingly important element of divorce settlements, especially for older couples who may have less time to build up new savings.

The number of brides and grooms aged 65 and over has risen by 46% in the past ten years, according to figures from the Office for National Statistics. (The over-65s as a proportion of the population is up by a fifth over that period.) The divorce rate has risen for older people, too among the over-65s it went up by 23% for men and 38% for women between 2005 and 2015.

Pensions are an increasingly important element of divorce settlements, especially for older couples who may have less time to build up new retirement savings. Research shows that couples who get divorced often end up worse off in retirement: married individuals retiring this year can expect their pension pots to generate an average annual income of £19,400, according to figures published by insurer Prudential. Those who have been through a divorce will have an income of £16,300.

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David Prosser
Business Columnist

David Prosser is a regular MoneyWeek columnist, writing on small business and entrepreneurship, as well as pensions and other forms of tax-efficient savings and investments. David has been a financial journalist for almost 30 years, specialising initially in personal finance, and then in broader business coverage. He has worked for national newspaper groups including The Financial Times, The Guardian and Observer, Express Newspapers and, most recently, The Independent, where he served for more than three years as business editor.