Pensions important in divorce cases

Wealthy couples who divorce hold more of their money in pension savings than any other asset, prompting concern that many people have little idea how splitting up could affect their retirement saving.

David Prosser
By
published
in Features

Wealthy couples who divorce hold more of their money in pension savings than any other asset, prompting concern that many people have little idea how splitting up could affect their retirement saving. Financial adviser Succession Wealth looked at couples with total wealth of more than £1m between them. The typical couple held 43% of this money in pension savings, against 31% in property wealth and only 20% in other financial assets.

When working out how to split a couple's assets, divorce courts are required to take pension assets into account, including both benefits already in payment and savings for the future. Funds can be split, or their value can be offset against other assets in the divorce settlement. However, many couples don't fully understand their options. Insurer Scottish Widows warned earlier this year that pensions are "fully discussed" in just 30% of cases, with 16% of women losing access to any pension fund after a split.

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David Prosser
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.

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