One of the skill sets that we have at Informed Choice is the production of single joint expert witness reports for the Court in respect of pensions and divorce.
In working out a financial settlement between divorcing couples the sometimes complex subject of how a pension plan benefit might be shared comes to the table.
Solicitors acting for the two parties will often invite a pensions expert to analyse the pension benefits held by the couple and work out how these funds should be shared to provide equality of income at retirement.
Of course the only way that this can be done accurately is to find out a lot of information about the pension plans.
One of the things that we notice in this area is that sometimes the data with which we are provided is out of date or incomplete.
Even for relatively simple pension plans (for example a Personal Pension Plan or Stakeholder Pension Plan), there is a substantial amount of data needed – for example;
· The name and address of the product provider;
· The policy or plan number(s);
· The start date of the plan;
· The expected maturity or retirement date of the plan;
· A complete record of the contributions paid into the plan by the plan owner and where applicable an employer;
· Whether the plan has been used to contract-out of the State Second Pension scheme and if so;
· The amount of the plan that represents “protected rights” (the part made up of National Insurance contribution payments to the plan);
· The current value of the plan broken down by investment funds;
· The transfer value of the plan so that any exit penalties can be identified;
· Whether the plan contains any kind of investment guarantees (such as guaranteed bonus rates on a with profits fund);
· Whether the plan has any guaranteed annuity rates in the policy conditions available at retirement age or indeed any other age;
When you consider that very often the information provided is simply the name of the provider and the transfer value, you can see that whilst that may enable a rough answer to the question “how much should be shared by each party?” it would be much more precise an answer with all the above information provided.
When the parties require advice about sharing a defined benefit (final salary) scheme then there is a whole load more information needed.
One of the things that we are going to do shortly is host a seminar for Solicitors and their staff explaining how these single joint expert witness reports are constructed and how vital it is to provide all of the relevant information.
Photo credit: Flickr/Keoni Cabral
