Divorce and Superannuation – Is Super Part of the Asset Pool?

When you’re getting divorced, superannuation can be part of the asset pool when you are dividing property and debts in your financial settlement. But super is a kind of property that is handled a little bit differently to other property.

Superannuation is not always required to be split in a property settlement. However, a lot of couples getting a divorce don’t consider superannuation. But actually, it can be very helpful to for your future financial position.

Here is how superannuation may be included when you are deciding your property settlement.

Is my ex entitled to superannuation?

Any Australian that is or has been employed is entitled to superannuation.

When it comes to your property settlement, you may be entitled to the division of superannuation between you and your ex. You also may be obligated to share your super. Most of these decisions may be made, either by you or the Court, where there is a significant difference in superannuation.

How is superannuation divided in a divorce?

Through agreement

If you use a property settlement avenue where you and your ex negotiate an agreement, such as a binding financial agreement or consent order, you can decide to split your superannuation. You may do this for various reasons, depending on your or your ex’s circumstances and future needs.

You can get a little more creative when negotiating with your ex and their lawyers to come to an agreement for property settlement outside of the Court. How you split it can be tailored to your needs and your possible future income.

When you don’t want to split super but take it into consideration

Remember when negotiating your agreement, it is not a requirement to split your superannuation. Depending on how much superannuation you each have, you might choose to split other property with each other’s super balances in mind.

For example, one party may have more superannuation from working for longer with a greater salary while the other will need more support for their health and children after the divorce. In this case, where one or both of you don’t want to split super, you can make concessions with other property or decide on a child support or spousal maintenance agreement.

It is important that you, or the Court, take the ages, income and income earning capacity, children, health and other needs and responsibilities into consideration when splitting property and superannuation.

Through the Court during your property settlement

In some cases, you may struggle to reach an agreement for your property settlement on your own. You can apply to the Court to settle how you will divide your property according to the Family Law Act.

The Court will treat superannuation like property and it will become part of the asset pool. At this point, the Court will follow the four-step process for property settlement.

The Court will

Require the identification and valuation of the asset pool (you and your ex must give full disclosure).
Assess contributions made to property by each party and will determine a percentage of the pool you may be entitled to.
Make adjustments based on factors such as age, health, income, etc.
Determine whether the division of assets is just and equitable.

How long after divorce can you claim superannuation?

A division of superannuation requires a superannuation order. This is because, as a matter of procedural fairness, you must give the trustee of your superannuation fund written notice of the order you and your ex want to make. This is required whether you go through the Court or agree between yourselves for your property settlement. Be sure to ask your lawyer to help provide the necessary information for the written notice.

Just like your property settlement, you need to apply for your superannuation order within 12 months of the date of when your divorce order becomes effective. If you are in a de facto relationship, you need to apply within 24 months of separation. You can also do this before your divorce whenever you do your property settlement.

Just because superannuation may have been divided in your property settlement does not mean that the money is put in your pocket straight away. Superannuation in a divorce is still to be treated subject to superannuation laws.

Superannuation is like “future money,” so most of the time, it cannot be taken until you have reached retirement age.

What if you don’t know much about superannuation?

This is where your Divorce Hub lawyer comes in. Superannuation can be a confusing and complicated part of the law and you may not know how to handle your superannuation funds. However, superannuation is so important to your future and it is heavily advised that you are aware of your super and protect it.

You may even have some superannuation you don’t know about, which can be helpful for your divorce and settlement. You may have more super funds than you are aware of.

Your superannuation can affect your property settlement or your will and estate, so always have a chat to your lawyer about superannuation.

Need help with divorce and superannuation?

Dealing with divorce and superannuation can feel complex and overwhelming. Divorce Hub can help you get all the documents you need and find a suitable result for you, all while helping you with any stress property settlement may bring.

Don’t delay your property settlement – whether you want to go through the Court or make your own agreement, contact your lawyers at Divorce Hub.