In this guest blog, James Thornton of Paradigm Family Law LLP looks at the increasing number of couples separating and divorcing later in life – increasingly referred to as the ‘Silver Splitters’. He prefers to call them ‘Diamond Divorcees’.
But what is it that triggers thoughts of divorce for those in their 60s or beyond and what are the things they should be looking out for?
“Statistics can be made to prove anything, even the truth”
The first thing to note by way of introduction is that whilst overall divorce rates are falling in the UK as a whole, the number of those divorcing who are over 65 is increasingly significant. In the last full year of reported figures (2015), the number of men and women divorcing and aged over 65 had increased by 23% and 38% respectively in the past 10-years. The full statistics by age range are here.
So why is it happening?
New rules introduced by the Chancellor George Osborne in April this year may lead to more couples who have reached retirement age to consider splitting up. The new rules hand the over 55s the freedom to cash in their pensions and take out lump sums to spend on whatever they choose (subject to tax).
Whereas those who may have stayed together because of financial security it seems that the new rules are giving them the confidence to go it alone with their new found freedom. No longer is it necessarily the case that the matrimonial home will have to be sold – especially where there are pension pots available for distribution that hitherto were locked away.
Divorce is now less of a taboo area than it was, certainly in the 1960s and 70s, when the baby boomer generation was getting hitched. People now live longer, are healthier and fitter well into their retirement. Perhaps ‘til death do us part’ is a bit longer now than was originally expected, to the extent that couples feel that they want more from life in their later years.
What are the key features of a silver divorce?
In many ways divorcing later in life is a simpler proposition. There tend to be no minor children to make arrangements for, whether financial or with whom they will live. But adult children can bring new issues into the equation – seeing the split as a threat to their future inheritance. Adult children may become actively involved in their parents’ divorce, taking sides or looking to influence the outcome of the financial settlement for not wholly altruistic reasons. However, the court will not take non-dependant adult children into account at all.
The relevant factors on divorce
For any divorce, whether younger or older, the court applies the same criteria when determining financial claims. These are to be found in the Matrimonial Causes Act 1973 at S.25 and are summarised as follows:
- The income/earning capacity or other financial resources which each party to the marriage has or is likely to have in the foreseeable future including in the case of earning capacity any increase in that capacity which it would in the opinion of the Court, be reasonable to expect a party to the marriage to take steps to acquire.
- The financial needs, obligations and responsibilities of each party to the marriage both now and in the foreseeable future.
- The standard of living enjoyed by the parties before the relationship broke down.
- The age of the parties and the duration of the marriage.
- Any physical or mental disability of either party.
- The contributions which each party has made to the marriage both in terms of financial contribution and in terms of contribution to looking after the home or caring for the family.
- The conduct of the parties but only if that conduct is so serious that it would be unfair to disregard it.
- The value of any benefit which either party will lose as a result of the marriage being brought to an end (i.e. pensions).
None of the factors takes precedence over any other, but clearly some will have more relevance to older divorcing couples than others – such as the impact on pension benefits.
The starting point on the division of marital assets is likely to be more or less an equal split. The asset in question will, more often than not, be the vast majority of what the couple has, particularly in a marriage lasting well over 20 years.
Where one party hasn’t worked for many years though, the likelihood of a lifetime maintenance order is a very real one. Whilst the overall trend in recent years is moving towards ending the notion of a meal ticket for life, ongoing support on a joint lives basis is likely, unless it looks as though the recipient can achieve financial independence – something that may be more difficult in later years. Again, the availability of pension cash may come into play here, although the court cannot compel a party to take their pension provision in cash, to say nothing of the tax penalties of withdrawing such lump sums.
Whilst the increasing numbers of divorcees over 60 may seem a depressing thought, what it does mean is that couples must now feel hopeful that their future is not stuck in the past. They can bring more enjoyment to their later years. No more are they duty bound by the stigma of divorce, or feel trapped in a loveless marriage with no chance of financial independence – they are grabbing the opportunity for a new start to the rest of their (longer) lives.
Contacting James Thornton
For more details or if you would like representation in financial or divorce proceedings, please do not hesitate to contact James. Paradigm Family Law offers a free initial consultation and their fixed fee solutions cover financial proceedings from start to finish.
Having a clear financial plan for the future is essential, so contact me, using the form below, at the earliest possible stage so that I can help put that in place. At the same time, I can assist with the completion of Form E (Financial Statement for divorce proceedings). I can also assist with the drawing-up of the necessary new Wills, Trusts and Lasting Powers of Attorney.