Couples over 50 caught up in the New Year rush to get divorced must sort out their pension arrangements or face being seriously out of pocket, warns one of Scotland’s leading financial advisers.
January, traditionally, marks the start of one of the busiest times of the year for divorce lawyers as couples discover the season of goodwill didn't apply to their spouses and decide to break up rather than make up.
According to nationwide relationship counsellors Relate the number of inquiries received by their offices has soared during January with a more than 66 per cent increase in people asking for help.
Despite an overall fall in UK divorce statistics by 5.5 per cent in 2008 to 136,025 the most recent figures from the Office for National Statistics (ONS) reveals older couples are bucking the trend as divorce rates have increased for both men aged over 60 and for women aged 50-59.
“Although the kids have flown the nest this can still be a tricky age to get divorced as people of that age are likely to have pensions which are designed to protect them in later life so it’s imperative they sort this out properly,” said Robert MacDonald of leading Glasgow financial advisers MacDonald & Co.
“Lets assume it’s a 50 – 50 split and the husband has been paying into his personal pension while they’ve been married, in that case the wife is due half of the fund.
“If it’s an occupational pension it depends on the particular company scheme whether they will allow what is called shadow membership or not.”
Shadow membership essentially means that the earning party must share half of their pension with their spouse.
“It’s worth checking out because the divorced spouse is dependent on the fabric of the scheme,” said Mr MacDonald. “Whereas, if they could transfer out they could then take a chunk of money and have a hold over it, investment flexibility and put it into a personal pension.”
For more information please visit www.macdonaldandco.com or call Peppercorn PR on 0845 217 8757.