Divorcing after Retirement
Divorcing after Retirement: The financial implications
More and more people are separating and divorcing later in life. In addition to the usual issues that you need to think about when separating, such as where you will each live and how you will pay for your overheads, there are a number of other issues you will need to be aware of if you are retired or close to retirement.
For many couples, the pensions accumulated during working life are the most valuable assets of the marriage aside from (or even including) the family home. The sharing of pensions is a complex area requiring expert input on valuation to ensure that any sharing maximises the available capital and income. This is true whether pensions are already in payment or not.
When separating after retirement, pension income is often the only income being received by the separating parties and it is crucial that older spouses getting divorced make sure that they secure a fair financial settlement that takes into account the pension assets of their spouse and that steps are taken, if necessary, to prevent a spouse encashing all or part of their pension to the detriment of the other spouse.
Property and other assets
The family home is usually the most valuable asset in the matrimonial pot. Older spouses will often find it difficult or impossible to obtain new mortgages and so close consideration will need to be given to how any other savings or investments can be used to make sure that both parties have enough money to afford new homes.
It is sensible to obtain advice about how inheritance tax and other taxes, such as Capital Gains Tax, apply in each individual case in order that appropriate tax planning can be taken into account when deciding on how and when assets should be shared on divorce. This is especially true when couples are looking to liquidate assets to rehouse themselves separately.
Often, divorcing couples will have had wills in place for years leaving their estate to one another. It is therefore essential to review and update wills upon separation and divorce to ensure that your estate passes to your chosen beneficiaries.
Here at David Gray we can offer you specialist advice on all matters arising out of separation. Our family law specialists will aim to help you reach agreement away from Court where possible. Call Louise on 0191 243 8167 to make an appointment or email email@example.com. We can also refer you to our specialist will writers for advice on Wills.