Divorce after 50 can be financially complex compared to those who divorce earlier in life. That’s because more established couples have usually built up their wealth in property, pensions and savings, and have less earning potential as they get closer to retirement.
But as our latest research reveals, many couples aren’t looking at all aspects of their wealth when they separate.
Later life divorce
When couples over 50 divorce, more of them turn to family (24%) or friends (20%) instead of a financial adviser (12%)1. That’s one of the findings from our latest research into later life divorce, which has revealed a trend of financial inequity and insecurity for later life divorcees.
Other findings include:
- 20% of couples talked about their pension, versus 58% who talked about the value of their joint home
- 26% are financially worse off after their divorce
- 21% say their retirement lifestyle has been negatively impacted because of their divorce.
Better divorce outcomes start with financial advice
A lack of financial advice among divorcing couples means it’s common for important assets to be missed out of a settlement, despite being entitled to a share. This most commonly happens with pensions, which is among one of the largest assets a couple will have along with their home.
Our research reveals that couples typically discuss their jointly owned property in a divorce settlement, but that pensions are a huge financial blind spot. This can have a knock-on effect for separating couples’ retirement planning and income, particularly for women, affecting financial wellbeing in later life.
To help you recognise these financial blind spots, we’ve created a new guide to later life divorce, Divorce in later life: the expert’s handbook PDF: 763KB. The guide is full of expert insights to help you understand the divorce landscape, the assets that matter and the professional networks you can tap into for assistance.
Whatever your area of financial expertise, all advisers can benefit from improving their knowledge around later-life lending and retirement income, so that you’re prepared to inform your clients of their choices if they come to you during their divorce.
As pensions expert Fiona Tate put it on our Just Covered podcast:
“One of the frustrations that we have as financial advisers is that by the time the client actually talks to us about it, the deal has been done.”
By being in regular contact with your clients and engaging with them early on, the outcomes are much more likely to be positive. It can strengthen your client relationships, build trust and secure them financial stability after their divorce.
Tapping into your networks
There may be some areas you’re less comfortable with advising in, for example, mortgages or annuities. That’s where your professional networks can help you make sure you’re giving your client a holistic advice approach from the start, unlocking the potential of all their assets.
It also means you can manage your client’s expectations early on.
“Having the right connections and being able to refer them to the right professionals is key at this time,” says Manjit Kaur, The Mortgage Mum.
Your definitive guide to advising for later life divorce
The ins and outs of later life divorce are complex and multi-disciplinary, so it’s important you feel empowered to help your clients through what will be a difficult time.
By reading the guide, you’ll understand the latest research, get insights from industry experts, get a glimpse into the legal divorce process, get to know the product solutions that can support your clients, and find out how to overcome common client misconceptions.
1Opinium Research conducted 2,750 online interviews of UK adults who are divorced. The research was conducted between 20 and 30 November 2023.
