With so many things to consider during a divorce, you may not be thinking about the long-term financial impact of your decisions as you divide your marital assets – especially pensions. Rather than waiting until after a divorce settlement, we recommend reaching out to a Financial Advisor to help you:
Understand the value of your financial assets, and the long-term effect of dividing them
Help you re-shape your financial plans following divorce, and make the most of your settlement
Remember, after a lifetime together, it can be hard for couples to separate their finances. Having an unbiased financial expert on your side can give you confidence that you’re making the most of your finances.
How can a Financial Advisor support you during a Divorce?
"Often, I’m only brought in after a settlement has been awarded. At this stage my clients have become overwhelmed with the process and more importantly are not aware of what the financial settlement is comprised of and what they need to do. If possible, I always try to start work before this point."
Terry Ratcliffe, Independent Financial Advisor
As financial planners, our role is not to get into the reasons why a couple is getting divorced. We focus on what will happen to their future finances, standard of living, and how financial planning can limit the financial and emotional impact of the process.
We’re also on hand to help your clients establish their financial priorities and then guide them through the next stage of their lives to ensure they meet their goals.
Divorce financial planning areas
The role of a Financial Advisor in Divorce
As financial planners, our role is not to get into the reasons why a couple is getting divorced. We focus on what will happen to their future finances, standard of living, and how financial planning can limit the financial and emotional impact of the process.
We’re also on hand to help your clients establish their financial priorities and then guide them through the next stage of their lives to ensure they meet their goals.
Pensions and divorce
You will need to value your assets and agree on a ‘fair distribution’ of those assets. This may mean transferring or cashing in investments, which can trigger charges or Capital Gains tax. Depending on the complexity of your financial arrangements, a Divorce Financial Planner could help find a balance agreeable to all parties.
Tax planning and divorce
A divorce can impact how much income tax and capital gains tax you’ll need to pay. Before any divorce settlement, we recommend talking to a Financial Advisor to get to grips with your new tax position and how spousal exemptions will be affected.
Divorce and investments
You will need to value your assets and agree on a ‘fair distribution’ of those assets. This may mean transferring or cashing in investments, which can trigger charges or Capital Gains tax. Depending on the complexity of your financial arrangements, a Divorce Financial Planner could help find a balance agreeable to all parties.
Divorce and mortgages
A divorce could result in one or both parties moving house. If you have a mortgage together, both parties are responsible for paying this until a financial settlement is reached. Wren Sterling also offers mortgage advice and can support any changes to home ownership.
Divorce and Estate planning
Do you plan to remarry? When updating your Will, how will you divide your assets between your loved ones? These are the sort of questions a Financial Advisor will ask when supporting you with your estate planning, helping you consider different scenarios so that your wishes can be carried out.
How could divorce affect your business?
Even businesses are considered assets and can be affected by a divorce. It is possible to compensate the other party with other assets, in some cases this may not be possible. To protect you, your employees and customers, consider discussing your options with a Financial Advisor.
Importance of financial advice during a divorce
Reflecting on your finances can be easier when you have a Financial Advisor on your side who can listen to your concerns, understands the process of a divorce, and what your financial decisions will mean for you in the future.
Understand the consequences of financial decisions
Some financial decisions cannot be undone – such as those during a divorce settlement, or changes made to your pensions. With the guidance of a Financial Advisor you can be aware of the consequences and make confident financial decisions.
Peace of mind
The UK’s taxation, inheritance and pension legislation is complex, which is why we recommend getting support from a Financial Advisor for their expertise. Having a Financial Planner on your team could help you avoid emotion-based decisions that could affect your quality of life in future, and give you peace of mind that you’re making the most of your finances.
Assess the long-term impact of your settlement
A Financial Advisor can help you understand the long-term impact of a divorce settlement on your financial plan. With cashflow planning tools, to consider different scenarios your Advisor can give you a picture of your financial future and what kind of lifestyle you can expect.
New attitudes to your finances
With changing personal circumstances, you may have a different view on your financial plans. You can discuss different scenarios and talk about the future, using cashflow planning tools to understand the effect of you your decisions.
Collaborate with your team
Your Financial Advisor can work alongside other professionals, such as solicitors and accountants, to ensure that the actions you take a fair, legally sound, and financially fair.
Do you know anyone who is going through divorce who could benefit from speaking to your financial planner?
What does financial planning during a divorce look like?
The road to divorce can be different for each couple. It will be up to them whether to take legal or divorce financial advice, and depending on the complexity of their finances and personal circumstances, they may not need to. In its most simplified form, the road to divorce in the UK involves:
Seeking support – Clients seeking help from a financial planner are often referred to us by family or friends during the divorce process.
Preparing your Financial Disclosure – A Financial Advisor can help you get up to date valuations of your assets for an accurate Financial Disclosure.
Taking legal advice – Clients considering support from other professionals, such as solicitors or accounts, should do so before completing their Financial Disclosure as they may be able to help.
Making arrangements for children, financial assets and property – The couple will need to decide how to divide their assets, and how dependants will be supported. Professional services can help ensure a fair distribution.
Applying for a Decree Nisi – Also known as a ‘Conditional Order’ this document says that the court sees no reason why you cannot divorce. The financial settlement could be put in place from this point on.
Applying for a Decree Absolute– This ‘Final Order’ confirms the end of a marriage.
Reporting your changed marital status – You may need to report your divorce to various institutions, for the purpose of visas or tax calculations.
How Wren can help you with divorce financial advice
“There can be an urgency to finalise a divorce, without understanding how financial decisions could affect client’s future quality of life. My role is to assess the situation and make sure they’re making decisions based on the ‘real truth’ – after all, emotion can play a huge part in decision-making – especially for children of clients who’ve just seen their parents split up.”
Why choose Wren Sterling to support with divorce financial advice?
16,000+
clients
£11bn
assets under advice
100+
Financial Planners
*Assets under Management and Assets under Influence combined for Wren Sterling Financial Planning Group companies, as at June 2025. Figure is rounded to the nearest billion
Financial advice after a divorce
For some people a divorce can mean they need to manage their own finances for the first time – and at have just received a settlement which they are unsure of how to use. For couples divorcing later in life, their settlement may need to provide an income for their whole retirement.
While a financial planner cannot advise on all aspects of budgeting (such as for household bills), they can tell you what you will need to do to stay on track. They can also continue to advise on more complex areas to make sure your money is managed correctly and with confidence.
Can we help?
If you know a friend or family member who is facing divorce, Wren Sterling can help. We’re there to be a useful ally initially and to talk sympathetically but candidly about what financial planning can do. We can work together with solicitors to make sure the process captures all the relevant financial information and as a guiding hand for what comes next.
How can cashflow planning assist with divorce financial advice?
How can cashflow planning assist with divorce financial advice?
“Divorce may only be the starting point of our discussion, with perhaps Pension Offsetting or a Pension Sharing Order, weighing it up and making a recommendation. But then we reach the question ‘what should I do with this money?’ Then we can work together on a financial plan to achieve their goals – for this I use cashflow planning.
This is a tool that lets you illustrate the effect of a divorce on your finances, rather than just looking at the numbers. We create a graph, building in your income, state pension, plans to go on ‘that holiday’ or make that ‘big purchase’, which lets us visualise your finances to project what will happen next and what kind of quality of life you can expect. Ultimately, I’m better able to get to know my clients, and how they might react to different scenarios, and can better prepare them for their future.”
How can a financial planner help me during my divorce?
How can a financial planner help me during my divorce?
After a lifetime together it can be hard for couples to separate their finances. Having an unbiased financial expert on your side can give you confidence that you’re making the most of your finances. A Financial Advisor can help you:
Understand the value of your financial assets, and the long-term effect of dividing them
Find the most tax-efficient way to divide assets
Help you re-shape your financial plans following divorce, and make the most of your settlement
What is in a settlement?
What is in a settlement?
A divorce settlement is a legal agreement that lays out how all assets (such as property, savings, investments, pensions) will be divided after divorce. It can be difficult to understand how this will affect your future finances, and whether or not you will be worse off if you chose to keep one asset over another (such as the family home). This is where a Financial Advisor can help you understand the consequences of your financial decisions.
Can I keep my own personal pension after a divorce?
Can I keep my own personal pension after a divorce?
The division of a couple’s pensions should also be considered during a divorce. It’s not compulsory to share your pensions in divorce. If a split is amicable, the couple may want to avoid the expense of court, making an informal agreement with their now ex-partner. But a court order is unavoidable, as it is needed for any agreement to be enforceable.
Pension Sharing is one option available to couples hoping to have an amicable split, that doesn’t leave either having to ‘start from scratch’ with their retirement plans. Find out more in our article on pensions treatment during divorce.
What is Pension Sharing?
What is Pension Sharing?
A Pension Sharing Order is a type of court order that is used to allow a couple to divide their pension funds on divorce. This is an arrangement that can be flexible – starting with discussions of a 50/50 split, but allowing clients to amend the percentage going to each party depending on the other assets involved (like the family home), or their circumstances. For example, if one person is retired and the other is not.
What is Pension Earmarking?
What is Pension Earmarking?
Pension earmarking is effectively a form of deferred maintenance payment, where all or part of the pension benefits of one of the divorcing couple are ordered to be paid to the other spouse. Earmarking orders may also be made against a member’s tax-free cash benefits on retirement and in respect of lump sum death benefits.
What is Pension Offsetting?
What is Pension Offsetting?
Pension Offsetting allows for a clean break between parties, as each person keeps their pension assets, but this is offset against other assets.
The information contained on this page is for information only and does not constitute financial advice. The Financial Conduct Authority does not regulate estate planning, Wills or cashflow modelling. Your home may be repossessed if you do not keep up repayments on your mortgage.
A pension is a long-term investment not normally accessible until age 55 (57 from April 2028 unless the plan has a protected pension age). The value of your investments (and any income from them) can go down as well as up which would have an impact on the level of pension benefits available. Your pension income could also be affected by the interest rates at the time you take your benefits.
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