Divorce for higher old age pension

My husband and I have pretty much decided that we want to retire in Switzerland. We were married 10 years before moving here. Now that we know more about old-age pension penalties for married couples, we are wondering if getting divorced wouldn't be a good financial move. We obviously are married as far as we are concerned, but just from a legal standpoint it seems like we would end up better off if we divorced so that we can each get a full pension instead of just 75%. We both work and earn good income. What is your take on this?

Hi there,

There are good arguments on both sides, particularly if you both earn an income and save for retirement individually. However, there are a number of things to consider before rushing into a divorce for higher pensions.

Firstly - and perhaps most importantly - married couples (and registered partners) benefit from inheritance tax waivers which unmarried couples do not benefit from. In most cantons, your spouse can inherit your assets on a tax-free basis when you die.

Secondly, it is worth noting that social security provides survivors insurance which pays out a benefit to your spouse if/when you pass away.

Thirdly, if one of you were to become unemployed and remain unemployed for a long time, they would benefit from the fact that their spouse's contributions cover their social security contributions as well.

Best regards from Moneyguru