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Explore your options when dividing a pension if marriage breaks down

By Clare Curran, Matrimonial Department at Worthingtons Solicitors

A pension is usually one of a number of assets, the ownership of which requires to be resolved after the breakdown of a marriage. There are various ways in which the division of the value of a pension may occur, and how much is shared will depend on all the circumstances of the case. 

If one or both of the parties has a pension which is of a substantial value, the parties may need to consider getting a pensions expert to provide an analysis of the value of the pension and the impact of sharing same. A specialist matrimonial solicitor will advise whether such a report will be needed.

One common way of dealing with a pension would be to ‘offset’ one party’s interest in the other party’s pension using the value of other assets, which allows the pension to remain intact with the spouse who earned it. In return, that spouse will forego or accept a reduction in their interest in other matrimonial assets, such as the matrimonial home or other savings and investments, up to an agreed or specified value. 

Another option would be to obtain what is known as a ‘pension sharing’ order whereby the pension is shared between both the divorcing spouses. A transfer payment will be paid to the divorcing spouse equal to an agreed or specified percentage of the total valuation of the pension, on the date upon which the pension becomes payable, with the value of the original pension being reduced accordingly. 

A less common route would be to deal with the pension by way of an ‘attachment order’ which specifies that a pension scheme member’s former spouse is entitled to an agreed or specified percentage of the pension from the point of retirement until they die. This option is rare given the limited security that such an order gives to the former spouse and the fact that it would result in an ongoing financial link being maintained between the parties, which is often not desirable.

If both parties are willing, issues pertaining to the division of pensions and all other related financial matters, can be resolved constructively, without huge legal costs being incurred and without years of acrimonious litigation.  The right legal and other expert advice should save you money, time and assist you in achieving your objectives for you and your family, both now and in terms of financial planning for the future. 

  • Clare Curran is head of the matrimonial department at Worthingtons Solicitors, which has offices in Belfast and Newtownards, and serves clients throughout Northern Ireland. She can be contacted on clare@worthingtonslaw.co.uk or 028 91811538

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