The role of solicitors and mediators during divorce is well documented and shouldn’t be taken lightly or underestimated as many self representing clients find out to their cost.
However, aside from wrangling over custody arrangements, would you leave it to either professional party to value your house during a split of assets?
No? So why is it that little or no heed is often taken in divorce proceedings with regards to the pensions?
As I stated in the above article, there are many solicitors that I work with that do have the necessary skill set to enable you to achieve a fair outcome, often calling in the necessary professionals to assist with their advice.
I have recently been contacted by two claim companies and an independent solicitor looking at past settlements and wanting referrals from me for potential claims they can investigate. They are investigating whether the true value of the pensions has been ignored, overlooked or misunderstood as part of the overall settlement.
This is no coincidence and perhaps a sign of the times but 12 years after the legislation was passed bringing pension sharing into force I am still seeing big mistakes being made.
To avoid having to go through this with your pension sharing case then please get in touch now on 01204 663904.
FAQs
While solicitors often use the CETV provided by the pension scheme, this figure rarely represents the true “utility” or future value of the pension. It is a snapshot of what the fund is worth today if moved, not what it will provide as an income in retirement. A specialist valuation ensures you aren’t trading a “real-world” house for an “underestimated” pension.
A solicitor is an expert in the law, not in actuarial mathematics or financial markets. While they manage the Pension Sharing Order, they generally rely on the figures provided by the scheme. Without an IFA or a PODE (Pension Officer on Divorce Expert), significant nuances like guaranteed annuity rates or final salary benefits can be missed entirely.
A Pension Sharing Order (PSO) is a formal legal document that instructs a pension provider to transfer a percentage of one party’s pension credit to the other. It is the most common way to achieve a “clean break” divorce, but the percentage must be based on an accurate, professional valuation to be truly fair.
Many historical settlements used “offsetting” (where one person keeps the house and the other keeps the pension) based on incorrect valuations. Because pensions are often the most valuable asset sometimes worth more than the family home miscalculating them has led to professional negligence claims years after the divorce is finalized.
No. Splitting a pension fund 50/50 by capital value rarely results in an equal retirement income, especially if there is an age gap between spouses or differences in gender-based life expectancy. A true valuation looks at “equality of income” rather than just “equality of cash.”
Obtaining the initial CETV from a provider can take 6 to 12 weeks. However, a formal expert valuation from a financial professional usually takes an additional 2 to 4 weeks. It is vital to start this process early to avoid delaying the Decree Absolute or Final Order.