FAMILY LAW Pensions on Divorce Seminar

Posted February 3rd, 2012

This week I attended an excellent seminar in London. The principal speakers were Edward Hest, District Judge, Principle Registry Family Division, David Lockett, Consultant Actuary, Actuaries for Lawyers and Philip Way, Partner Mills and Reeve LLP. The course was a mixture of practical guidance, hot topics and case studies.

The course was extremely enjoyable from the point of view of updating my Continue Professional Development (all Resolution Accredited IFAs have this obligation to keep their accreditation) but on a personal note is was lovely to meet up with many of my fellow Resolution Accredited IFAs and put a face to an email or Linked In contact and to talk shop with them.

I was struck by the level of co-operation and collaboration that went on during the day and this bodes well for the future of financial advice and planning within divorce cases.

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Pensions on Divorce: Retail Prices v Consumer Prices

Posted October 9th, 2010

The Public Sector Pension schemes – (NHS, Police, Civil Service, Local Government, Teachers, Armed Forces) are changing the way that they increase pensions in payment and revalue pensions in deferment from being linked to the Retail Price Index (RPI) to the Consumer Price Index (CPI).

RPI and CPI are measures of UK domestic inflation which are calculated by collecting a sample of prices for a selection of goods and services.

The major difference between the two measures is that RPI includes mortgage interest costs but CPI does not. Historically, this has meant that CPI has increased at a lower rate than RPI and it is therefore, expected to do so in the future.

In pension on divorce cases this change will potentially have two main knock on effects.

  1. It will have a negative impact on cash equivalent transfer values – the actuarial experts I have spoken with estimate that CETVs will be potentially up to 20% to 25% lower in some situations.
  2. It will mean that in retirement the amount of revaluation that each parties’ pension will receive will be lower.

If you would like more information on how these changes might affect you, please get in touch.

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Pensions & Divorce – Self Invested Personal Pensions – What are the risks?

Posted August 20th, 2010

Self Invested Personal Pensions (SIPPs) are designed to allow individuals to control their pension, using a wide range of investments. Their popularity has soared in recent years and they are becoming more and more common when dealing with pensions on divorce.

However, they have only recently (April 2007) become regulated and there are risks associated with SIPPs which are worth knowing. This is especially so if you know that the financial aspects of your divorce will take time to be agreed.

The list below illustrates the broad range of investments available.

• UK and overseas shares
• Gilts and overseas securities
• OEICs and unit trusts
• Exchange Traded Funds
• Investment Trusts
• Insurance Company Funds
• Unquoted shares
• Warrants
• Hedge funds
• Deposit accounts
• Commercial Property

With such a wide range of investments available and the potential for these to fall in value over time, it would be prudent to understand what lies beneath. I will expand on this issue in future blogs so watch this space.

If you would like an impartial review of the SIPP involved in your divorce, please contact us on 0800 092 1229 or email advice@thedivorceifa.co.uk

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