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Divorce reduces retirement income

People who plan to retire this year are likely to be £2,100 per year worse off on average if they have been divorced, an insurance firm has claimed.

Prudential publishes annual assessments of the prospects of people planning to retire over the coming 12 months. Its newly published Class of 2015 report cites the average annual income of people planning to retire this year as £17,800 for those who have never been divorced, but only £15,700 for those who have.

Divorcees are also more likely to delay retirement than others, and the one in five who retire with debts are likely to owe more if they have previously been divorced.

Around one in five divorced retirees expect to have less than £9,500 to live on when they retire, compared with 14 per cent of those who have never divorced.

Claire Moffat is a pensions specialist at Prudential. She said:

“Although the emotional impact of divorce may have long passed, it could come as a shock for people to find that it continues to impact them financially into their retirement. A pension fund is likely to be one of the largest and most complicated assets a couple will have to split in the event of a divorce.”

Image by Barry via Flickr

The blog team at Stowe is a group of writers based across our family law offices who share their advice on the wellbeing and emotional aspects of divorce or separation from personal experience. As well as pieces from our family law solicitors, guest contributors also regularly contribute to share their knowledge.

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