5 key financial planning steps for your employees to consider during a divorce

Often, the beginning of the year sees a significant increase in couples filing for divorce after the holiday season. 

While divorce can be emotionally challenging, it may also signal the start of a new life phase. It’s important for your employees to consider their financial plans, set goals, and prepare for potential challenges as the process and aftermath of a separation might significantly affect their financial position.

These financial hurdles can cause additional stress during an already difficult time.

This guide will outline five key financial planning considerations that employees should keep in mind while navigating the hurdles of divorce.

Secondsight is a trading name of Foster Denovo Limited, which is authorised and regulated by the Financial Conduct Authority.

The Financial Conduct Authority does not regulate estate planning, cashflow planning, taxplanning, trusts, Lasting Powers of Attorney, or will writing.

Your home or property may be repossessed if you do not keep up repayments on your mortgage

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the levelof pension benefits available. Past performance is not a reliable indicator of future performance.

Pension income could also be affected by interest rates at the time benefits are taken.

Pension savings are at risk of being eroded by inflation.

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.

Note that life insurance plans typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse.

Cover is subject to terms and conditions and may have exclusions. Definitions of illnesses vary from product provider and will be explained within the policy documentation.