Pensions are often one of the most valuable assets a person owns — sometimes even more valuable than the family home. So, it’s no surprise that one of the most common questions people ask when separating or divorcing is:
“Do I have to share my pension?”
Considering Pensions in Divorce or Separation
When couples separate, all financial assets need to be considered as part of the overall settlement — and that includes pensions. There’s no automatic “opt out”, even if one party feels strongly about keeping their pension intact.
That said, the eventual outcome doesn’t always mean the pension must be split. In some cases, one may retain their pension in full if the other’s needs can be met from different assets. Alternatively, if an offsetting approach achieves a fair result.
When Are Pensions Likely to Be Shared?
In long marriages, particularly where there are few other significant assets, pensions usually form part of the financial division. In these situations, the court will often make a pension sharing order. This ensures both parties have a fair share of retirement income.
A pension sharing order allows a percentage of one person’s pension to be transferred into a pension in the other person’s name. This can help achieve a clean break, meaning both parties can move forward independently and manage their own pensions in future.
What About Unmarried Couples?
It’s important to note that unmarried couples do not have an automatic right to share pensions on relationship breakdown. Unless there’s a clear, written agreement between them, pensions remain the property of the individual who built them up.
Getting Advice
Pensions can be complex — and decisions made during separation can have long-term consequences for your financial security in later life. It’s always wise to seek specialist legal and financial advice before agreeing to any settlement involving pensions.
If you’d like advice about how pensions may be treated in your separation or divorce, Geraldine Watson Family Law can help you understand your options and work towards a fair outcome.