WOMEN are being urged to check for a simple mistake that could leave them thousands of pounds out of pocket.
When a couple divorce, they will usually agree on some sort of financial settlement, especially if children are involved.
And while people often spend time deciding what will happen to assets such as the family home, pensions are often overlooked.
This could be a company pension, or a personal pension pot.
As a result, thousands of women who split with their partners may not be getting the amount they are entitled to.
Steve Webb, partner at LCP and former pensions minister, said there are thousands of women who miss out on significant cash.
For example, a final salary pension, officially called a defined benefit (DB), could be worth hundreds of thousands of pounds.
So, not getting half of that – or the equivalent – could be literally hundreds of thousands of pounds lost.
He said: “When going through a divorce it is tempting to concentrate purely on the here and now and ignore your longer term financial position.
“But a company pension can often be one of the most valuable assets that a couple has.
“It is vitally important not to rush any divorce settlement but to take expert advice, which can pay for itself many times over if you manage to secure a fair share of a large pension pot.
“Without this, a divorced woman has a high chance of having a very modest standard of living in retirement”.
Mr Webb said women have a legal right for the value of a pension to be considered in any divorce settlement.
But it’s important to get pension rights valued and to come up with a deal early in the divorce process.
This is because, once a settlement is reached, it would be very hard to get the case reopened at a later date.
Steve said that if there is a court settlement, the court should prompt parties to make sure pensions have been considered at the time.
If it’s just a private settlement between the parties, however, then this may not happen.
And while legal advice can be expensive, Steve said it will pay for itself in many cases.
Those divorced at the point of retirement can get some of their pension payment based on their husband’s national insurance record.
You have to make a claim for the state pension – it’s not paid automatically.
But many women don’t bother if they don’t think they will get anything.
Anyone who does claim should find a box to tick to say they are divorced, which means they should get the money automatically.
Women who divorce after retirement are affected too.
They are entitled to pension payments based on their ex-husband’s entitlement, but must tell the Department for Work and Pensions.
Anyone in this situation will need to tell the DWP and should do it as soon as possible, as these payments can’t be backdated, Mr Webb added.
In either case, entitlement does not affect the amount of pension an ex-partner gets.
Men in the same situation are also entitled to state pension payments based on their ex-wife’s entitlement if they have fewer national insurance credits.
But women have traditionally taken on more caregiving responsibilities and missed out on national insurance credits through work, meaning they are more likely to be affected.
It’s just one way that women’s pensions are worth less than men’s.
Anyone who thinks they are not getting the right state pension can contact the Pension Service for help.
