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Why is it so important to think about superannuation if you separate or divorce?
No one enters a relationship thinking it will fail. But fail they do. In fact, around 50,000 Australian couples get divorced each year.
But what does this have to do with super?
According to HESTA Education Manager Marthes Pattman, how superannuation is split during a divorce or separation could have a long-term impact on your financial future during retirement.
"When couples separate, super can generally be split as part of a couple’s joint property."
“Even though your super is in your name, super sets itself apart from conventional assets.
“If you have a de facto partner or spouse, it’s treated as a joint asset.”
How is super divided during divorce or separation?
When couples separate, super can typically be split as part of joint property, but it’s not mandatory.
If separating couples do go on to split their super, in the best-case scenario, an amicable decision on how much each person gets will be reached. If not, a court order to might be necessary.
Splitting super is the most common way that couples apportion accumulated assets during divorce or separation. Super splitting typically follows these steps:
- Find out how much super is in your former partner’s super account or accounts. You can request that the court obtains this information from the ATO.
- Reach an agreement with your partner then seek a Consent Order from the court (it’s a good idea to get legal advice). If you can’t agree, then apply for a court order. There are a number of factors that may be taken into account when determining how super will be split, including non-financial contributions to the relationship, such as taking care of children. A court may also consider the financial position each of you will be in after the divorce or separation.
- Send a copy of the Consent Order or court order to the super fund or funds.
We’re here for you
Marthes strongly recommends seeking advice from one of our super specialists before you begin the super splitting process.
“Divorce or separation can be tough,” Marthes says.
“It’s not just the emotional stress, but also the challenge of staying organised that can be overwhelming.
“Super can be one of the biggest investments you and your former partner have, so make sure you consider super as part of any separation or divorce.”
need help splitting your super?
HESTA for Mercy experts can provide advice about your super at no extra cost. It’s all part of the service.
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