Mel GibsonJack Plunkett/AP/Press Association Images

Mel Gibson and his ex-wife Robyn Moore are having to go through the horrors of a very public split. The latest twist in the tale is that Moore will receive a large portion of Gibson's pension benefits.

And while this may seem like a less than thrilling turn of events, it reveals something truly astonishing about how your assets are split on divorce.


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The split

The couple were married for 26 years and have seven children. They divorced in 2011, and the financial details are trickling out in news reports. The latest claims that she will gain a large percentage of his $800 million assets including a slice of his pension benefits.

As far as celebrity news goes, it's unlikely to see copies of weekly magazines flying off the shelves, but for anyone considering a split, or going through the process, it helps illuminate one of the hidden and shocking facts about divorce.

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Pension shock

Since the year 2000, spouses have been entitled to half of their other half's pension (their work or private pension rather than their state one). This is a big deal for two reasons.

First, the amount of money at stake is astonishing. A recent piece of research by the TUC found that top directors can easily have over £600,000 in their pension. The average occupational pension pot is £40,000, but when you remove the smaller pots built up over a very short period a typical pot can easily be £200,000. Often that's as much as the family home is worth.

Second, the effect this has on your retirement prospects is dramatic. If your pension is halved when you divorce, you are suddenly looking at far longer in work, or a shockingly different kind of retirement.

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And these kinds of deals are not unusual. More than one in ten divorces include what is known as a pension-sharing order, and according to legal publisher Sweet and Maxwell, that's an 11% rise in the last year.

As people have fewer liquid assets to divide between them, they end up negotiating with the two major assets they have: the house and the pension. In some instances they'll take one of these each; in some cases they'll split both in half.

It's certainly something worth knowing well before you decide to split. If you fail to consider your pension, you might make some very poor decisions when it comes to dividing your assets. It's hard to imagine any other area where you might accidentally forget a few hundred thousand pounds sitting in your spouse's bank account.

Mike Morrison, head of pensions development, AXA Wealth, says: "Pensions will often be one of the most significant financial assets in a marriage (perhaps after the family home) and are therefore available to be taken into account in any financial settlement when couples divorce. What may have looked like it was going to be a comfortable retirement could be drastically changed if one of the party's pension scheme becomes subject to a pension sharing order in favour of the other. In such circumstances, professional financial advice could be vital, and it may be a good idea to take advice even before starting the divorce process to avoid any unforeseen consequences."

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