For every divorcing couple, ideas about what constitutes a fair financial settlement will differ and even the best divorce solicitor in London, Brighton or elsewhere in the UK will have to take into consideration their client's own wishes in achieving a suitable division of assets.

When it comes to pensions, some spouses are very protective of their rights to this particular, and sometimes very valuable asset, and may be unwilling to enter into a pension attachment or pension sharing order on divorce.

In this case, the divorce lawyer, their client and the other spouse may work together to devise a suitable way to divide other assets as part of the ancillary relief package to achieve a suitable clean break settlement, and this may involve pension offsetting.

Pension offsetting in a divorce financial settlement

Usually, to achieve a suitable pension offsetting agreement, the couple will examine other valuable assets held within the marriage and decide whether it is beneficial for the family to use offsetting as a way to balance financial division.

For spouses with young children, if the pension pot is substantial, it may be more appropriate to leave the pension intact and to surrender rights to the matrimonial home to the spouse who will be looking after the children.

Where a couple decide to liquidate assets, such as the matrimonial home, if one spouse wishes to keep their pension rights intact it may be appropriate to designate a larger lump-sum payment from the sale of assets to offset the potential future benefits from the pension.

However, there are a number of factors to be taken into consideration when deciding whether pension offsetting is the best way to settle pension rights.

Firstly, the spouse receiving the benefit of an increased lump sum payment or a larger share of rights to the matrimonial home will be receiving the advantage of their assets straight away and will not be subject to the uncertainties surrounding the performance of a pension scheme.

Nevertheless, they will lose any right to funds upon retirement and may be required to use part of the offset sum to secure finances for their own retirement.

Further, it may prove difficult for a couple to settle terms of pension offsetting, especially as pension values may fluctuate more than property values or that of other assets.

In the case of wealthier and older couples, the pension pot and potential retirement benefits, therefore, could be of significantly greater value than other matrimonial assets and in this case, offsetting may not be the most appropriate way forward in the divorce financial settlement.

Advice from a divorce solicitor on rights to a pension fund

If you are uncertain about the potential value of a pension or what type of pension division would be appropriate upon divorce, it is essential that you consult an experienced divorce solicitor at your earliest convenience to find out what action would suit you best. Divorce solicitors in London, Brighton and elsewhere in the UK will be able to advise, and Healys has experienced lawyers, across all areas of litigation, who will listen sensitively to your situation before making careful considerations on how best to proceed.

At Healys we believe the best way to achieve a just and fair ancillary relief package is to ensure all necessary financial information, such as pension and house valuations, investments held and projected earnings, is gathered as expeditiously as possible.

Our experienced divorce solicitors, based in offices in London and Brighton, regularly represent clients in both the High Court and in local courts across the south east of England and beyond. 

For sensitive yet straightforward advice on divorce please call direct to Catherine Taylor on 01273 669 124 or e-mail on catherine.taylor@healys.com