Divorcees £3,000 a year worse off when it comes to retirement

New research has found that divorcees coming up to retirement age expect to get £3,000 less a year compared to those who have never divorced.
Annual expected retirement income is £16,300 for those who have previously divorced compared with £19,400 for those who have never suffered a marriage break-up, the study by Prudential has found.

Divorcees and debt

One in three people who have been divorced expect to retire with debts (32 per cent), compared with just one in five (21 per cent) of those who have not been divorced.

Those who have been divorced are also more likely to have retirement incomes below the annual minimum income standard for single pensioners set by the Joseph Rowntree Foundation. Around one in five who have been divorced (21 per cent) expect to have incomes lower than the JRF’s benchmark of £186.76 a week, or £9,712 a year, compared with 13 per cent of those who haven’t been through a marriage break-up.

While the overall divorce rate is falling, the only age group seeing an increase in divorce rates is women aged 55 and over – a large proportion of whom will be planning their retirement or already retired.

Action plan

Clare Moffat at Prudential, said: “Retirees who divorced a while ago may want to consider seeking updated professional financial advice on any post-retirement plans they have made, particularly in the light of recent changes to pension legislation. There are also important differences in divorce law between Scotland, and England and Wales. Legal advice in the early stages of separation is therefore crucial.”