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Pensions. Don’t ignore them on your divorce.

Posted on the 28th January 2021 by Fiona Wilson

In many divorces the two main financial assets that I have to deal with are the matrimonial home and the parties’ pensions.

Whilst I find that many clients wish to deal with the family home, they will shy away from dealing with the pension. Yet the pension will provide a lump sum and an income upon retirement. It is an important asset and should not be ignored.

Whilst discussing finances with your spouse, you will have to exchange financial disclosure. That includes obtaining valuations of your pensions, this will give me an idea as to how we should proceed.

Guidance given from the “Pension Advisory Group”, (https://www.nuffieldfoundation... on_Divorce-Executive_Summary.pdf), promotes that when divorcing parties have significant pension funds, they should instruct a Pension Actuary, via solicitors. The actuary’s role is to obtain details of the parties’ pension, ascertain what type of pension scheme they are and their value. This will allow the actuary to give detailed and specific advice tailored to you on how the pensions should be shared.

Pensions can be dealt with, broadly, in three ways – there is not a “one size fits all” scenario.

  1. Pension Sharing Order. The main pension is shared. This means that the pension has a pension debit (a deduction from it) and the recipient party has a pension credit (a sum added) to their pension scheme
  2. Pension Attachment Order. The pensions remain intact, however upon retirement a part of the lump sum or income is re-directed to the recipient spouse.
  3. Pension Offsetting. This would mean that the pension remains intact. The other party would however receive a higher share of the current available assets.

Once an agreement is reached as to how the pension will be shared it will be recorded in a court order. That will need to be approved by the Judge and the Pension Sharing Order or Attachment Order will be sent to the pension providers who will then implement it. Pension providers must have an approved court order and the decree absolute from the divorce proceedings, before they can implement the sharing or attachment order.

Common questions

  • Do I have to go to court?

No. I will always try and resolve matters without needing to attend court. There will be times when we simply cannot reach an agreement and inevitably the court do have to become involved. I will always talk you through your options and the steps involved.

  • Can we just reach an agreement ourselves?

If there is going to be a Pension Sharing Order then there must be a court order. Pension providers cannot deal with a pension (sharing or attachment) without a court order.

  • Will we both have to have orders made against our pensions?

No. The spouse with the largest pension provision will usually be the one who has the pension sharing order made against their pension

About Fiona

Fiona Wilson is a solicitor in our Family Department in Hinckley and has 25 years’ experience. Fiona is a specialist family solicitor and the only accredited specialist member of Resolution in the Hinckley area. This means that Fiona has undergone further rigorous assessments to ensure that she puts our clients’ interests first and foremost and will always try and resolve matters amicably and fairly. Fiona understand and recognises that going through a divorce is upsetting, unsettling and brings about a whole host of emotions and worries that you are unlikely to have experienced before. Fiona puts clients at ease and is thorough in explaining the process and always giving clients options.

Fiona is currently offering a first fixed fee interview of £125 plus VAT, to discuss any aspect of family breakdown.

What clients have said about Fiona

“very sensitively and professionally handled”

“Mrs Fiona Wilson was excellent, very open, professional and honest and transparent”

“Your care was impressive and stands out from other professionals we are involved with”

“Fiona helped and advised me at a very difficult time – without her advice, support and guidance I would not have made correct decisions that were right for me”

“Found it easy to choose [Fiona] and felt at ease”

“Mrs Wilson was an expert in her field, always one step ahead”

About the Author

This article was written by Fiona Wilson. If you would like further information on the issues raised contact Fiona to discuss in more detail.

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