Sadly, nearly half of all marriages in the UK end in divorce. Therefore, if you haven’t been through a divorce yourself, you almost certainly know someone who has. However, what’s not as well known is that 30% of these divorces take place when someone is aged over 50.
As you can imagine, divorce for the over-50s can be very different when compared with people who divorce younger. The main (slightly obvious) differences are that the children are older and the finances are, typically, worth a lot more – mortgages are either paid off or almost paid off, and savings and pensions tend to be higher. This means getting fair financial settlements can sometimes be tricky.
Most people who are divorcing are aware that they may need good legal advice to help achieve a fair outcome, but what about good financial advice? Given that 41% of divorcees over the age of 50 feel that the outcome of their divorce wasn’t financially fair, it feels like good financial advice in divorce is a must.
So, how can financial advice in divorce help? Well, as a Resolution Accredited Specialist in financial planning on divorce, I’ve got a lot of first hand experience in this area but I’ll concentrate on one financial area in particular – pensions.
In my experience, for people who are over 50, pensions are often worth several hundreds of thousands of pounds, which makes them either the biggest asset, or the second biggest asset behind the family home. So, you might find it surprising that 29% of people divorcing over the age of 50 waived their entire rights to their partner’s pension. The Nuffield Foundation “Fair Shares” report published in 2023, suggests this is because there’s a lack of interest in pensions (perhaps driven by a lack of understanding), and that people can feel the pension “belongs” to the person who contributed to it (even though, in many cases, one spouse was able to work and contribute while the other spouse took significant time away from work to raise the family). The impact of all this is that 26% of divorcees aged over 50 are financially worse off and some of this could be avoidable.
So, who do you turn to for help? Well, many over 50s going through divorce will have a solicitor and, in my experience, divorce solicitors understand pensions to an extent, but pensions are complex things and solicitors typically don’t have the relevant qualifications and experience for a deeper understanding of all the options available. The professionals with this level of understanding are, you guessed it, financial planners! We can also help with a range of other financial issues in divorce, such as helping clients understand the future impact of any proposed financial settlements and arranging finances in a suitable way following the divorce.
In terms of looking for the right financial planner, seeking help from a Resolution Accredited Specialist will make a difference. We’ve got experience in dealing with a variety of assets in divorce and know that our clients are going through a tough time, so we approach our work with sensitivity and empathy.
I hope you’ve found this information helpful – if you or someone you know, could do with a chat, please get in touch
Sources: “Divorce in Later Life: The Expert’s Handbook” by Legal & General, March 2024; “Fair Shares? Sorting out money and property on divorce” by Emma Hitchings, Caroline Bryson, Gillian Douglas, Susan Purdon and Jenny Birchall, November 2023.
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