separation and super

We look at how super is considered through a separation or divorce.

No-one enters a relationship thinking it will fail. But fail they do. In 2020, almost 50,000 married couples were granted divorces in Australia.

The ongoing coronavirus pandemic has also taken its toll on relationships. A study on the impacts of COVID-19 by Relationships Australia found that 55% of people felt challenged by their living arrangements.

On top of that, 42% of people had experienced a negative change in their relationship with their partner due to the effects of the coronavirus lockdowns.

The sobering super stats for women

Women who have taken on the bulk of caring responsibilities and time out of the workforce can often have significantly less super than their partners. Super is a divisible asset, just like property, shares and savings, and that’s why it’s something that really needs to be considered during the settlement process.

Women in Australia currently retire with at least 37% less superannuation than Australian men. And Australian women over the age of 55 are the fastest growing homeless group in Australia.

How is super divided during divorce or separation?

When couples separate, super can typically be split as part of joint property. It’s important to note that a fair valuation of super forms part of the totality of assets shared by the separating couple. Splitting super may be an outcome – but not always, and 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:

1. 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.
   
   
2. Reach an agreement with your partner then seek a Consent Order from the court (it’s a good idea to get legal advice), or 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.
   
   
3. Send a copy of the Consent Order or court order to the super fund or funds.

Making super fair

For many women, super is the only asset they can claim from their former partner, yet many walk away from accessing it because dividing super assets through the family law system can be complex. It also often requires legal advice, which can be costly.

This can result in many women, especially those from low-income households or who are most vulnerable, simply walking away from their rightful share of super assets. This can mean losing their only income in retirement beyond the Age Pension.

HESTA is the first Australian super fund to adopt the Simpler Super Splitting initiative. This offers a simple, plain language form for court orders that can be used across the super and legal sectors and by the courts. Members can access the form via their lawyer or relevant proceedings.

HESTA recently trialled the court-endorsed orders and simplified process in a live super splitting case involving two HESTA members, which helped greatly reduce time delays and legal costs.

Do you need to start a conversation about your super?

HESTA Super Specialists can provide advice about your super at no extra cost. It’s all part of the service.

This information is of a general nature. It contains HESTA’s interpretation of the law but should not be relied upon as advice.