Divorce and your super

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Relationship breakdowns are one of the most stressful life events that people experience, and thinking about your super is often not top of the list of concerns.

torn picture and hands

But with one in three marriages breaking down, the consequences for your retirement savings are huge. We’re here to help, and TelstraSuper Financial Planning Advisers can offer advice and guidance to ensure your financial commitments stay on track.

Whether married or de facto, couples of the same or opposite sex are entitled to have their superannuation benefits split in the event of a relationship breakdown‡.

Your super is a valuable financial asset, and it forms part of your assets, just like a car or a house. Until a few years ago, it was more common for one spouse to take the house and the other to take financial assets, but this can result in very different retirement outcomes.

Since 2002, super has been included as property and courts can make orders to divide super along with other assets. The emphasis is on fairness, because even when one partner has been a homemaker during the marriage, the superannuation contributions have been a joint effort.

If the couple separating can reach their own agreement, they must instruct a lawyer and draw up a formal written agreement and then seek court consent to split super.*

Lagging in retirement

Women’s super balances at retirement are, on average, just under half those of men, and separation or divorce can widen these gaps if the assets aren’t split fairly. Around 80% of women are currently retiring without enough super to fund a comfortable retirement, according to the industry body ASFA.^

When your relationship ends, you have the right to request information about your partner’s super. This is important especially for women who've had long periods of time out of the workforce.

The super fund is required to provide this information about a person’s superannuation benefits, although they can’t provide personal details such as address or phone number.

When your marital situation changes, there are other important considerations as well. You may need to review your insurance and update your beneficiary nomination. And if you change your name, don’t forget to let us know.

Need help in times of change?

If you’re currently going through a separation, we know this isn’t an easy time. Come and see a TelstraSuper Financial Planning Adviser who can help you plan the steps you need to take and ensure your finances stay on track. Give us a call on 1300 033 166 to discuss the options available to you. Or fill in our online contact form to have an Adviser give you a call.

‡ De facto couples in Western Australia are not subject to superannuation splitting laws. 

*http://www.familycourt.gov.au/wps/wcm/connect/fcoaweb/family-law-matters/property-and-finance/superannuation/

^http://www.superguru.com.au/about-super/women-and-super