Divorce has major financial consequences, including for your pension. Half of the old-age pension accrued during the marriage must be given to the ex-partner. This therefore creates a pension deficit. Marriage and its breakup have major financial consequences. Most marriages are concluded in community of property. This means that after marriage, the assets of both spouses are joint assets. Another option is to get married with a prenuptial agreement. In that case, the partners must first go to the notary to record how they enter into the marriage in terms of assets and rights. For example, you can specify that the assets will not be mixed with each other.
Partner is entitled to half of the retirement pension
In the event of a divorce, the ex-partner can claim half of the retirement pension rights accrued during the marriage. The rights must, as it were, be split by the insurer or pension fund. The ex-partner will have a direct right of action against the pension provider. This is subject to the condition that the insurer or pension fund has been informed about the divorce within a period of two years. If this does not happen, the ex-partner is still entitled to half, but he or she must recover this directly from the former partner.
Ex-partner can also obtain his own right from the pension provider
The partners can also choose to convert the right into their own right for the acquiring ex-partner. This so-called conversion means that the ex-partner receives his own right that is independent of the former partner. This has the advantage that the financial ties between the ex-partners are broken and that the pension is no longer dependent on the life of the ex.
Divorce creates a pension gap
After the divorce, a gap occurred in the pension accrual. Depending on the length of the marriage, a divorce can cost half of the pension. Especially for older people, the pension gap can no longer be repaired. It may be possible to make additional arrangements. The gap can be partially closed with the help of annuity insurance, but the resources must be available for this. After a divorce, the highest-earning ex-partner must also pay alimony and possibly also child support. The question is therefore whether recovery of the deficit is financially feasible.
The entrepreneur must also divide his pension
It is legally established that the self-employed entrepreneur must also distribute his pension reserves in his company or his rights accrued with an insurer. The same applies to the director of a major shareholder who has built up a pension under his own management or with an external pension provider. In general, this does entail complications, because an accrued right with an insurer or pension fund is easy to distribute, but this does not apply to money that is in principle tied up in the company. However, it is mandatory to include these rights in the division upon termination of the marriage. Other agreements may be laid down in a prenuptial agreement.