A new report sheds light upon how couples sort out financial and property arrangements when they divorce.
The report, led by the University of Bristol and funded by the Nuffield Foundation, follows a survey of the experiences of over 2,400 people who had divorced in the past five years.
And the survey paints a worrying picture of couples often going through the process without proper legal advice, with the result that many clearly do not receive their true entitlement in the divorce settlement.
The survey found that only a third of divorcees made use of lawyers in relation to their financial arrangements, with many who did not do so deterred by fear of the cost.
But those who did seek legal advice reported that the amounts they spent on legal advice were relatively low. A quarter had had spent less than £1,000, with a further 18 per cent having costs between £1,000 and £2,999. Only nine per cent had costs of £10,000 or more, with those higher costs associated with greater wealth.
As to outcomes, the survey found that only 28 per cent of divorcees divided their wealth, including the matrimonial home, roughly equally, with some simply dividing assets according to who owned what.
Half of divorcees who had reached arrangements across all of their assets received less than £50,000, 21 per cent received less than £25,000, and 23 per cent ended up with nothing or only debts. Only nine per cent came out of the marriage with £500,000 or more.
But perhaps the most worrying finding was in relation to pensions. The survey found that more than a third of divorcees did not know the value of their own pension pot, let alone their spouse’s.
Unsurprisingly given that, the survey found that only 11 per cent of divorcees shared a pension pot. Reasons for not sharing included a general lack of interest in the pension, and a strong sense that it ‘belonged’ to the spouse who had been contributing to it.
Needless to say, failure to properly share pensions on divorce is likely to leave the party with less pension provision, most often the wife, suffering severe financial hardship in retirement.
Commenting upon the report Lead author Emma Hitchings, Professor of Family Law at the University of Bristol, said: “Overall, the report exposes the considerable financial vulnerability of women post-divorce. Although legal processes are largely fair, these are not being used, especially by those with least means but most need.”
You can find the full report here.
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