How to help vulnerable 'Divorce Day' clients

Advisers must therefore be not just experts in dealing with the technical aspects of divorce, such as pension sharing and division of assets, but also in the soft skills needed to hold clients' hands through this difficult time. 

Risk factors

Peter Burgess, founding partner and mediator at solicitors Burgess Mee, comments: "Divorce invariably makes people more financially vulnerable but sometimes they are already vulnerable.

"The family financial closet is laid bare, scrutinised and quantified before it is divided to meet the requirements of two households rather than one."

He says: "Whether they are a financial breadwinner, a high earner or a home maker, they can find themselves facing financial or personal difficulties as they struggle to come to terms with their new reality or they grapple for control when the future looks uncertain.

"Everyone, even the most financially successful and astute, is at risk, but particularly so if they have not taken steps to protect their wealth.  For many clients their financial settlement will be the single most important financial decision of their lives."

This leads to increased vulnerability - a topic the City watchdog, the Financial Conduct Authority, has been keen to impress upon the collective mind of the financial services industry.

Some advisers would say the so-called 'silver splitters' are particularly vulnerable, through loneliness, a lack of a decent pension for one party, and the prevalence of age-related health orders putting increasing pressure on individuals.

Peter Burgess concurs: "Older women are probably a demographic who are particularly exposed.

"A long absence from the workplace and a trend for shorter, lower maintenance awards means they can often find themselves disadvantaged by a career break or life decisions made with their husband when times were better."

The lower earner, or the non-working spouse, is often cited by advisers as being most at risk, due to the potentially cliff-edge in income that will be their lot post-divorce.

There is definitely room for greater clarity in the public understanding of how our system works -- Peter Burgess

Again, women are most likely to fall into these categories, due to the nature of employment especially if they have left work or are working reduced hours in order to care for any children.

But this is not always the case - and advisers might do well to consider that both parties are at risk at this time, regardless of income. 

Ben Burgess, senior adviser at Lifesearch, says both parties are particularly vulnerable. Even if one of them is not the adviser's client, making the process easier for both should be in the adviser's mind.

He says: "The emotional, mental, and financial anguish of going through a divorce can be crushing.