Do you know how the new reforms to pensions on divorce will affect you?
The family lawyers at Pinder Reaux, appreciate that the process of ending a marriage and dividing assets is likely to be a difficult time for both parties, even when a couple settle the division of their matrimonial finances on amicable terms.
For many divorcees, the dispute with their soon to be ex becomes protracted as the parties cannot agree on how to split the matrimonial “pot”, especially in cases where the matrimonial “pot” is limited in capital worth.
More common than not, parties will have to accept the harsh realisation that the pot of equity which has amassed during the parties’ marriage, falls short of allowing each party to purchase a property upon divorce and it is common for one party, or even both parties are forced into the rental market when considering their future housing needs.
Similarly, divorce settlements for men can be particularly challenging where there are substantial assets involved, such as pensions, which may be more likely when the parties involved are in later life and until such time as the parties reach the requisite age, most pensions are wholly inaccessible.
Often in divorce cases, it is usually the wife who retains the former matrimonial home because she is the lower earner or requires a larger property to house minor children from the marriage, and in consideration of the same the husband will retain his pension fund. However even where the division of equity from the former matrimonial home matches that of the husband’s pension pot, the pension fund will be of limited use to the husband as it can only be accessed in part as tax-free cash, with the balance dripped out as taxable income over the remaining lifetime of that party.
Advice for men getting divorced
However there appears to be a glimmer of hope for divorce settlements for men and for family lawyers advising husbands, because the government has proposed new reforms with greater access to divorcees’ pension funds which could make it easier for couples divorcing in later life to split their assets.
From April 2015, those aged over 55 will be able to access their entire pension pot as cash which could prevent unnecessary property sales and pension transfer delays for those divorcing. Under the new region many couples, particularly husbands, will be afforded the freedom to being able to take their pension as a lump sum, or series of lump sums, rather than having to buy an annuity.
The changes ahead are fundamental to any family lawyer’s advice for men getting divorced. Here at Pinder Reaux we pride ourselves at being at the forefront of advising our clients on how such changes are likely to affect you.
We have a team of strategic forward thinking family lawyers who will strive to achieve your objectives as quickly and as cost effectively as possible. Call us on 0208 252 7373 and one of our family lawyers will gladly discuss your matter in detail with you.