All You Need To Know About Claiming Pensions after a Divorce

Once a couple decides to get a divorce and go their separate ways, splitting finances often becomes an issue. In addition to splitting the property and dividing up the assets, the question of pension also weighs heavy on the ex-couple’s shoulders.

As such, financial settlements need to be drawn up to ensure that both parties abide by the rules accordingly—including pensions settlements.  

Let’s take a look at the connection between pension and divorce law in the UK.

The impact of divorce on your pension income

The financial setbacks of divorce have both long-term and short-term ramifications. Research shows that getting divorced can significantly reduce the retirement income of an individual by a sixth. In addition to that, the divorcees have reported a 16 percent reduction from their expected retirement incomes, compared to those who aren’t divorced.

This drop is the result of the hefty cost of splitting up finances and valuables, as well as the legal fees. Hence, to minimise the financial damage that you incur during divorce proceedings, you should be well-versed in your rights when splitting up finances.

Pension splitting

Since you’re obligated to disclose all your financial assets so that you and your ex-partner can come to a fair divorce settlement, pension assets also need to be brought to the light.

Pension assets that have to be divided between you and your former partner include workplace pensions, state pensions, personal pensions, and state pension top-up income.

What are your options?

Here’s how pension assets can be split:

Pension sharing

Under pension sharing, the pension assets are included in the total value of the marital assets and a person receives a percentage of the total value of their ex’s pension. The money received by the former partner is called pension credit and works by either transferring a pension into their name or by allowing them to join the existing pension scheme.

Differed pension sharing

This method is used if your former partner is retired as is receiving their pension but you’re still underage to claim the pension yourself. In this case, the ex-couple can agree upon a later date on which they’ll begin sharing the pension.

Pension off-setting 

This form of pension division entails the allocation of assets that are similar to the pension. It allows you to keep your pension, while your ex gets financial assets that have a similar value to the pension.

Pension attachment or earmarking

This method gets you a share of your former partner’s pension once they claim it. You can share the pension income or receive a lump sum of it depending on your needs. This also redirects all the pension benefits of your ex-spouse to you.

If you want to make a pension claim after your divorce, get in touch with professional legal help so you can divide up your pension income and other financial assets properly. At Wembley Solicitors, we offer a wide range of legal services to help our clients. From expert divorce solicitors in Wembley to family law solicitors, we help you get the best financial settlements in your divorce.

So get in touch with us today!