You’ll normally need to decide how your pensions are split between you – they do not always need to be shared equally. You could consider using a mediator to help you decide.
How to divide your pensions
There are three ways to split your pensions. You can:
- transfer a portion of one person’s pension to another, called pension sharing
- ask the pension provider to pay a share of the future pension income to each of you, called pension attachment or earmarking
- keep the full pension and let the other partner take other assets of similar value, called pension offsetting.
You can usually choose to use one or more of these options.
As valuing and splitting pensions can be complicated, consider paying for:
- legal advice from a solicitor
- financial advice from a financial adviser.
The following organisations can put you in touch with a qualified adviser in your area:
Unbiased at www.unbiased.co.uk. You can find independent and restricted ‘whole of market’ advisers on their website. Restricted ‘whole of market’ means advisers who can offer available products from all companies, but who may specialise in a particular area, such as pensions.
Personal Finance Society at www.findanadviser.org. You can find independent and restricted advisers on their website.
VouchedFor at www.vouchedfor.co.uk. You can find independent and restricted advisers on their website.
This will help make sure you both understand your rights, options and if you’re both getting a fair deal.
Agreeing how to divide your pensions
There are two ways to agree how to split your pensions during a divorce or dissolution:
- agree between you, with or without legal advice or mediation
- ask the court to decide for you.
It’s usually cheaper and quicker to agree between you, if you’re able to and it’s safe to do so.
Either way, you’ll both need to share the details of all your finances, including the value of any pensions.
If you’re unable to agree, you can ask the court to decide on a fair split for you.
Your pension providers then have up to four months to action any changes to your pension.
State Pensions
Your State Pension usually cannot be shared between you, unless you reached your State Pension age before 6 April 2016.
In this case, you might have to consider splitting any Additional State Pension or protected payments. You can request a State Pension valuation for divorce or dissolution on GOV.UK.