Women are losing out on fair divorce settlements because couples are trying to divorce “on the cheap”.
Research has found that most couples have so few assets that the vast majority try to save money by sorting out key arrangements themselves, including agreeing housing, pensions and ongoing maintenance.
A report, led by the University of Bristol and funded by the Nuffield Foundation, found more than one in 10 couples in England and Wales sought no advice or information to help them with their divorce. Only two in five divorcees made use of lawyers as a source of information, advice or support.
Many of these couples cited fear of cost as a deterrent to using legal advice. But when legal advice was used, nearly a quarter of divorcees said it cost less than £1,000.
“In the wake of cuts to legal aid, and hampered by a lack of financial and legal knowledge, couples are trying to divorce on the cheap,” said the report’s author, Emma Hitchings, a professor of family law at the University of Bristol.
“But this means they are bypassing a legal system designed to achieve fairness. That is leaving women worse off and putting their future financial security at risk.”
The Fair Shares report found only one in 10 divorcees with a pension yet to be drawn had made an agreement for pension sharing.
“Although legal processes are largely fair, they are not being used,” said Hitchings. “The equal division of pension pots is not the norm: only three in 10 of those who had any assets to divide in the first place reported receiving around half of the net asset pool.
“More than a third of divorcees did not know the value of their own pension pot, let alone their spouse’s,” she added. “Without all assets, particularly pensions, being considered on divorce, the future financial security of many women, who generally have smaller pension pots than men, is being put at risk.”
Proposals for reform are being considered by the Law Commission and the controversial divorce (financial provision) bill in the House of Lords has been presented to parliament, which would make equal sharing of assets the default.
“This research lands at a critical moment, when the laws implemented half a century ago around divorce finances are under review,” said Ash Patel, the programme head for justice at the Nuffield Foundation.
“It highlights the persistence and prevalence of myths around divorce, and clearly demonstrates the often unequal financial footing of parties going into, and coming out of a divorce,” he added. “Here, women appear more financially vulnerable, tending to be financially worse off than men in the years after the divorce.”
The research revealed the state of family finances in England and Wales, with the average divorce pot – including home, pensions and taking into account any debts – calculated at £135,000.
Almost a fifth of divorcing couples have no assets to divide at all, with a quarter of divorcees ending up with nothing or just debts.
“The research highlights that the total value of assets most couples have is modest,” said Hitchings. “This presents a totally different picture to the media portrayal of substantial divorce settlements of the very wealthy and gives an important reality check on what ‘everyday’ couples are experiencing on divorce.”
