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So, what are your pension options at divorce? Below, we look at the two main routes you can take. There may be other more complex tailored options, which would require further discussion.

But remember, it’s crucial to get advice from a pensions specialist to help you make the right decision. Pensions can be very complicated, especially if you don’t normally handle the household finances.

It’s very important to make the right choices now as they will affect your financial health in the future. This is something your divorce solicitor can help you to access, signposting you to the right professional.

Option 1 – Pension sharing order

This is where both your pensions are considered together as one big pot. A court order is used to determine who gets what percentage of the other’s pension.

The pros of this arrangement include:

·        Both people get a pension pot of some kind

·        It’s easy to understand – many pension arrangements can be very complicated

·        You can have a clean break from your partner.

However, there are some drawbacks including:

·        You will have to wait to access the money if you aren’t yet of pension age

·        A court order is required, which means some time and money spent on legal proceedings.

Option 2 – Pension offsetting

This is where you each keep your own pension, but it requires a trade-off when negotiating a divorce settlement. For example, assets of the same value as the pension are allocated to the other person.

The pros of pension offsetting include:

·        A completely clean break

·        Keeping your own pension

·        It can help either person to stay in the family home.

However, there are of course some disadvantages:

·        You will need to compromise – giving up other assets of a similar value in the divorce settlement

·        It’s possible that one person may be left with little or no pension income when they retire

·        Splitting assets fairly can be difficult.

If you need help making the right financial choices in divorce, get in touch with Liverpool divorce lawyer Tracey Miller Family Law. The whole team is here ready with practical, trustworthy advice, so give us a call on 0151 515 3036.