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Rise of 'silver separators' leaves women high and dry

The number of couples divorcing in their sixties is increasing, a trend with serious financial implications for women.

 

by Michelle McGagh on Nov 19, 2013 at 12:23

Rise of 'silver separators' leaves women high and dry

An increase in the number of ‘silver separators’ is leaving women in their sixties with bleak financial prospects.

The stigma that used to be attached to divorce, particularly for older generations, has largely disappeared and with it comes the growing phenomenon of ‘silver separators’ who divorce in their sixties.

As life expectancy continues to improve the prospect of spending possibly decades in retirement with a spouse is forcing many to rethink their relationships.

Figures from the Office of National Statistics (ONS) show that in 2011 there were 9,439 divorces where the husband was over 60, an increase of 73% from 1991. Over the past two decades the rate of divorce in women over 60 has soared by 81%.

Helen Relf, tax director at Baker Tilly, the accountants, said divorce at or near retirement was more likely to be brought by men, leaving many women ‘high and dry’ financially.

‘We are seeing more people divorcing later in life and it has an impact on women in particular,’ she said. ‘Last week I had a client in his seventies who said he was going to leave his wife. Usually it is men divorcing women and when it comes to the rise in over sixties instigating divorce, often the men are the drivers behind it.’

Pensions blow

The problem for women is their lack of pension saving. For the babyboomer generation, those born between 1946 and 1955 and now in their sixties, it was customary for the woman to stay at home and raise children rather than work and save for retirement.

Although the government is trying to rectify the financial gender gap with a flat-rate £144-a-week state pension in 2016, women are lagging behind men when it comes to workplace and private pension savings. A report earlier this year by Scottish Widows showed women have on average £13,000 less saved in their pensions than men.

Relf said most female 'babyboomers' expected to live off their husband’s pension in retirement so divorce often had serious repercussions for them. ‘Divorce [late in life] leaves women financially and emotionally insecure,’ she said. ‘The key issues for them are the fact that they have relied heavily on their husbands to look after them financially and have not had to deal with financial arrangements.

‘They have not built up a pension because they have stayed at home to look after a family…when divorce happens in the forties there are often still children involved so the financial impact is less because the husband has to provide [for the children]. But with divorcing in your sixties women have less of a claim on income and they are less protected. They are left without pensions and without a means of earning income because by that stage it is difficult for them to get into the jobs market,’ said Relf. 

She urged women to ensure they check what they are entitled to as ‘often in divorce they will get an allocation [of the husband’s income] and an entitlement to be maintained’.

Divorcing women should also be aware that it is not just how much of their husband’s pension they receive that matters, but also how they access is it.

‘There are a number of ways to divide it but in some cases the wife cannot get access to the fund until the husband accesses his [proportion].’ Relf said she had seen women in their sixties going through divorce being forced to move in with ‘very elderly parents’ because of lack of access to pensions and other investments.

Tax advice

Investment portfolios can also be another pitfall for women to consider when divorcing and Relf recommends taking tax advice to avoid a large tax bill when splitting interests in shares and funds.

She said it was a good idea to split and subsequently transfer investments while still legally married in order to take advantage of spousal exemptions which allow the transfer of investments without needing to cash them in and incur capital gains tax (CGT).

‘Splitting portfolios can mean cashing them in and that can trigger CGT,’ she said. ‘The later you do it then the more chance there is of triggering CGT.’

There are similar concerns about splitting investment properties and Relf said divorcing spouses needed to weigh up both the future value of a property and the future income it could generate when dividing assets.

From Relf’s experience she has found that it is not just their own financial stability that divorcing women are concerned about but also that of their children, with fears that a husband will remarry and start a new family and first marriage children will be sidelined.

‘The wife always assumed assets would be passed between her and her husband and them on to the children,’ she said. ‘But if you have a new wife on the scene there are fears that she will disappear with the money [that was earmarked for the children].’

Relf said it was ‘best to try and negotiate what happens in the future and set up trusts for children’ moving assets from the estate to the children immediately.

‘It is one thing to worry about your own income but that knowledge…that the money may be divided between a new group of people [or new children] can be very distressing.’

8 comments so far. Why not have your say?

L L

Nov 19, 2013 at 15:25

Ridiculous article! The woman would leave the man high and dry and take more than 50% of assets, including half his pension.

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J Thomas

Nov 19, 2013 at 17:10

This article is about fifty years out of date and can only have been written by a woman.

Family and divorce Law is written by women, for women, and the vast majority of Judges in these case are women.

The poor downtrodden wife will get more than 50% of everything the husband has worked for to begin a new life probably with a new partner.

And She will want victim status as well.

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Ian Phillips

Nov 19, 2013 at 18:20

"They have not built up a pension because they have stayed at home to look after a family…"

In this case they have accrued enough "stamps" to get an individual full state pension!

I agree with the other contributors......rubbish article!

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Ian Phillips

Nov 19, 2013 at 18:23

"From Relf’s experience she has found that it is not just their own financial stability that divorcing women are concerned about but also that of their children, with fears that a husband will remarry and start a new family and first marriage children will be sidelined."

How many women 60+ are supporting children??........rubbish!!

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L L

Nov 19, 2013 at 19:56

This article needs to be taken off citywire for being absolutely wrong.

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snoekie

Nov 20, 2013 at 04:04

ER, Michelle, it is usually the women that want the change and reckon they are entitled to everything for their years of "service".

When it comes to divorce, the judges forget that women are equally capable, and made the choice. Equality, nope, there remains the sexist apartheid in place with the more capable women (a la harman) claiming everything including the kitchen sink. Remember Heather Mills?

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snoekie

Nov 20, 2013 at 04:20

BTW, what about the years of service and toil by the men, catering to many (and quite a few insane) demands from the women?

Women seem to think they will easily land another, only to wake up toooooooooooooooooooo late to reality, unless they have someone lurking in the background, when they should get a lot less (but they never admit). Don't give me the guff of what they had to put up with, because there was a helluva lot more coming the other way.

If the bloke wasn't bringing home the bacon, she would have left long before. That

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Elizabeth Haggis

Nov 21, 2013 at 12:00

Good Lord, what a load of misogynists.

It's a very good article and has loads of common, as well as legal, sense in it. I know lots of women whose marriages have broken down without them wanting it to, and who have been left financially high and dry, with husbands starting second (and more) families late in life. Obviously they will worry that the first (or second.. or third..) family will lose out to the subsequent one.

The underlying message in the article is for women to start making their own provision and not to rely on men to do it for them. Good advice.

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