Divorcees missing out on thousands by settling directly with their exes

Divorcees missing out on thousands by settling directly with their exes

4th June 2024

Divorcees could be short-changing themselves by thousands of pounds when sorting out their financial arrangements with their exes.

Partners on a lower salary – usually women – are subject to a steep drop in income, after a marriage breakdown – especially in the first 12 months – with one in five admitting to not even being able to meet essential costs.

But couples are not taking advantage of the professional help available to ensure a fair settlement for both parties in the event of a divorce.

The courts are there to ensure a fair outcome for both parties which includes helping the person on the lower income to  transition into a life of financial independence. Many people don’t realise, but a 50-50 split is in most cases only a starting point for a separation. It doesn’t have to end at 50-50 if that would leave one party really struggling.

In the event of a family home being sold as a result of a divorce the courts, where possible, will seek to help the person on the lower income back on to the property ladder, even if it means granting a larger share of the proceeds of the sale of the house to that person.

In addition, an ex-spouse is also entitled to a share of their former partner’s pension at the point of settlement, rather than waiting until their partner reaches the pensionable age. The money is then able to re-invested into another pension scheme for that person.

We generally receive clients through the door when they can’t reach what they deem a fair settlement with their former partner. But what is more difficult to measure is how many people don’t use the help of a court and are settling for far less than they are entitled to.”

Statistics* show that at the point of divorce men have an average £60,000 in their pension pot as opposed to £23,000 for women.

In the first 12 months after a divorce a woman’s income will fall by an average 41 per cent while a man’s will fall by 21 per cent.

Twenty-four per cent of women face financial struggles after divorce, compared to 18 per cent of men, and 21 per cent of women struggle to even pay for essentials, compared with 13 per cent of men.

Thirty per cent of women are more likely to waive their right to their partner’s pension, as opposed to 17 per cent of men.

*Statistics from Opinium Research on behalf of Legal & General.

Divorce is a life-changing situation and we want that experience to be as stress-free as possible. Our solicitors can assist with all aspects of divorce, from the initial issuing of the divorce petition, all the way through to obtaining the final order. For further information please contact our Family and Matrimonial department.

Article written by Solicitor and Head of Family and Matrimonial, Kate Booth.