Pensions and Divorce: How Pensions Are Split
After the family home, pensions are usually the biggest asset in a divorce, and the most commonly overlooked. Skipping them in a settlement can quietly cost one partner a comfortable retirement. Here is how the three legal routes work in England and Wales, in plain English.
First: pensions are on the table
All pensions belonging to either of you count in the financial settlement: workplace pensions, SIPPs, old pots from previous jobs, and public sector schemes. Each is valued (usually via a cash equivalent transfer value, or CETV, from the provider), and courts decide what is fair using the factors in section 25 of the Matrimonial Causes Act 1973: needs, ages, earning capacity, contributions and children's welfare. Fair does not automatically mean 50/50, but pensions built up during the marriage are very much shared property.
The three routes
| Route | What happens | Clean break? |
|---|---|---|
| Pension sharing | A percentage of one pension is carved off and becomes the other person's own pension | Yes |
| Offsetting | One keeps the pension, the other gets more of something else (usually the house) | Yes |
| Attachment (earmarking) | Part of the pension income is paid to the ex when it comes into payment | No |
Pension sharing: the standard modern route
A pension sharing order transfers a set percentage of one person's pension into a pension in the other person's name, either within the same scheme or moved to their own (a SIPP is a common destination). It is final, it survives remarriage and death, and each person's retirement is their own from that point. That independence is why courts and advisers generally prefer it.
Offsetting: trading the pension against the house
Common where one person wants to stay in the family home: they give up pension claims in exchange for more of the property. The danger sits decades away. A house you live in is not income at 70, and comparing a pension's transfer value against bricks and mortar is genuinely hard, because £100,000 of CETV and £100,000 of house equity are not worth the same in retirement. This is exactly where an actuary or financial adviser earns their fee.
Attachment orders: rare for a reason
An attachment (formerly earmarking) order redirects part of the pension income to the ex when it starts being paid. The recipient stays dependent on their former spouse: payments usually stop if the member dies, and can be affected by remarriage or the member's choices about when to retire. Modern settlements mostly avoid it.
Scotland is different
In Scotland, only the pension value built up during the marriage itself is normally counted, and the settlement machinery differs. Northern Ireland has its own equivalent rules. If you are outside England and Wales, get advice specific to your jurisdiction.
What about the State Pension?
The new State Pension cannot be shared in a divorce, though a court can take it into account when weighing overall fairness. Some older additional State Pension rights under the pre-2016 system could be shared; your solicitor will check if that applies.
Practical steps that protect you
- List every pension, including forgotten ones. Old workplace pots count. Our guide to finding lost pensions helps you build the full list.
- Get CETVs early. Providers can take weeks to produce valuations, and public sector schemes' stated values often understate their real worth, which is worth a specialist's eye.
- Do not waive pension claims casually. Giving up pension rights for short-term cash is one of the most common regrets, particularly for the lower earner who took career breaks.
- Rebuild afterwards. Whichever side of the split you are on, re-run your retirement numbers and adjust contributions; both parties usually retire on less than the couple would have.
Re-plan your own numbers
After any settlement, see where your pension actually stands. Our free calculator shows what your pot could grow into from here.
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This article is for general information only and does not constitute financial or legal advice. Divorce settlements depend entirely on individual circumstances and jurisdiction; the description above covers England and Wales. Correct as of July 2026. For your own situation, speak to a family law solicitor and a financial adviser regulated by the Financial Conduct Authority (FCA), or get free guidance from MoneyHelper.