Divorcees £3,800 a year worse off when they retire

Divorcees who plan to retire in 2018 can expect their yearly income to drop by £3,800 compared to those who’ve never divorced, according to new research from Prudential. For those retiring in 2018, expected annual retirement income is £17,600 for those who have previously been divorced, compared with £21,400 for those who have never experienced a marriage break up.

The research also found that those who have been divorced are more likely to retire in debt than those who have never been divorced, and that divorcees are more likely to have no pension savings at all when they retire than those who haven’t been through a divorce.

Clare Moffat, pensions specialist at Prudential, said:

“Divorce can have a huge financial impact on people’s lives. Many may not realise that the cost of divorce can last well into retirement, as divorcees expect retirement incomes of nearly £4,000 less each year than those who have never been divorced.

“The stress of getting through a divorce can mean people understandably focus on the immediate priorities like living arrangements and childcare but a pension fund and income in retirement should also be a priority. A pension fund is one of the most complex assets a couple will have to split so anyone going through a divorce should seek legal and financial advice to help them do so. For many more couples, the increase in value of pensions mean that it is often the largest asset. It goes without saying that advice is crucial as early as possible in any separation where couples have joint assets.”

Family Law Cafe strongly agrees that anyone going through a divorce should seek the best legal and financial advice available, as soon as possible. Family Law Cafe can help you find the advice you need. To contact us click the Contact link above and fill in the form, or call us on 020 3904 0506.

For an outline of how pensions are dealt with on divorce, see this post.

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Image: retirement, by Hamza Butt, licensed under CC BY 2.0.