New research* from the University of Manchester's Institute for Collaborative Research on Aging (MICRA) supported by the Pensions Policy Institute, has shown that there is still significant disparity between male and female pension wealth and concludes that there is "considerable potential for pension sharing" on divorce which could substantially affect the later-life finances of many women.
There are a number of things to consider when beginning your financial settlement on divorce; one main issue will be to understand whether a clean break settlement is appropriate or whether spousal maintenance is required.
Ideally, you and your former partner should attempt to come to an agreement in respect of the finances. If you can't agree, you will need to ask the family court to make a financial order on your behalf. If you seek a court order you will be required to undertake a Mediation Information and Assessment Meeting (MIAM) to see whether mediation could help you reach an agreement.
Like many other aspects of everyday life, the family courts have been badly affected by the coronavirus pandemic and divorcing couples may find they must endure a significant wait if their case needs to go to court. However, as a way of hopefully reducing ongoing delays, the government has launched a £1 million voucher scheme for mediation services in England and Wales.
While family lawyers and divorce solicitors are largely in favour of alternative dispute options for separating couples in order to reduce the stress and, at present, adversarial nature of divorce cases, it is hoped that this incentive plan does not cause some parties to agree terms which are not in their best interests, particularly those with reduced income or reduced means of seeking income following a divorce.
The importance of seeking early family law legal advice and, where possible, settling non-contentiously – for example, via alternative dispute resolution such as mediation – has been brought to the fore by the latest estimates from HM Courts & Tribunals Service (HMCTS) which show that it is likely to take around three years for courts to return to pre-Covid caseload levels.
Inevitably, this means that there is a significant backlog, and The Family Justice Board acknowledged as much when it indicated that it both needs to tackle “immediate pressures” and to initiate the process of implementing longer-term reform.
The first working Monday of the New Year has, through the experience of divorce lawyers, come to be known as “divorce day”. This is because, typically, Christmas and New Year tends to bring struggling relationships to an inevitable and irreversible breaking point.
However, divorce day 2021 was always likely to be different to recent years because the lockdowns and associated pressures of 2020 had already resulted in many failing marriages to have ended.