Money Box 2

There was another set of interesting questions about divorce and separation on BBC Radio 4's Money Box today. This time the topics covered included pensions, 'aliment', parents' financial responsibility towards over 18s in education and jurisdiction. I couldn't help feeling sorry for one caller from Milton Keynes who had cohabited for 17 years, raised her partner's children and had no financial interest in any assets. In Scotland she would have been able to make a claim based on the disadvantage suffered from giving up employment to care for the children but of course in England cohabitants still have no rights.

The panel of experts were Liz Welsh, Chair, Scottish Family Law Association, Janet Tresman, Consultant, Piper Smith Watton and Simon Piggot, Partner, Levison, Meltzer, Piggot and the podcast is available here. There is also a list of useful internet links and helplines here.

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What's Happened to CETV's?

Bradshaw, Dixon and Moore's blog The Ancillary Actuary looks at what's happened since new regulations for calculating pension Cash Equivalent Transfer Values came into force on 1st October 2008.

Full post Source The Ancillary Actuary 16 April 2009

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Women Are Retiring £6,600 Worse Off Than Men

Women retiring this year will receive an average £6,642 less a year from their pension than men, a report out today reveals.

The average woman retiring in 2009 will draw an annual pension of £13,671, while men will typically receive £20,313 a year, according to Prudential.

The average retirement age is currently 58, according to the insurer's Class of 2009 survey. But 61 per cent of those questioned did not think their pension and other savings would provide enough income for a comfortable retirement.....

..... The pensions gender gap is caused by a combination of career breaks, lower earnings and savings and a rise in the number of divorced women without a husband's pension to support them, according to Karin Brown, annuities director at Prudential.

She said: "It is still a shock to see so many women retiring at such a disadvantage to their male colleagues, despite all we know about the causes of pension discrepancies between men and women.

"When women have children, their pension contributions reduce significantly or stop altogether, and their state pensions often take a hit as well."

Full story Source The Scotsman 8/4/09

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Roundup

I'm still a bit behind with blogging, but at last I have managed to get all my papers to my accountant so he can work out how much tax I'm due to pay at the end of the month so hopefully I'll have a bit more time.There are one or two stories and blogs worth mentioning.

Following on from The Ancillary Actuary's earlier debate about women loosing out on pensions in divorce last weekend The Independent carried an article The better halves who get the worst of it when romance dies looking at the problem. David Lister, a partner at law firm Mishcon de Reya, raises the point that a wife will need a greater percentage of the pension fund as it has to go longer.


Continuing the pension theme in a judgement M-D v D [2008] EWHC 1929 (Fam) recently released in England a wife successfully appealed an ancillary relief order on basis that the order had failed to make sufficient provision for her pension and the husband ordered to pay further lump sum of £35,000. Thanks to John Bolch of Family Lore Focus for the lead on this and also a post Ever Heard of NAPOD? Divorce : The Blog about…Divorce

This is about a trade body for companies who provide online divorce services but are not regulated. However, it appears there is just one company behind this who are promoting it as a reason to use their service over any other.

Incidently John Bolch has started a new Family Lore Focus Forum.


Finally in The Times article How to make divorce feel great Amanda Lynch looks at a London-based service called Divorce Support. Its founder, Charlotte Friedman, was a family law barrister for 25 years, before training as a therapist, and now offers individual therapy or group sessions for fellow divorcees.

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Confidentiality, Loosing Out & Sharia

In Marylyn Stowe's post 'Kitchen Confidential – by guest blogger Jonathan James' the misuse of documents and information during divorce proceedings, in particular copies of documents “left lying around” are considered in light of the recent English case White v Withers & Anor [2008] EWHC 2821 (QB)


Nigel Bradshaw of the Ancillary Actuary highlights two of three systematic failings in the way pension issues are settled in most divorces that causes a wife, or rather 'the person with the smaller final salary pension,' to lose out. The first fault, using CETVs for valuing final salary pensions is explained here and the second, the common practice of discounting, or reducing, a pension value when offsetting, is here.

I think it's right to question the logic of discounting a pension for offsetting purposes in divorce. From a finances POV I don't understand the idea that assets which can't be readily accessed are less valuable than those that can. I've never come across this in other countries apart from in England. Is it an American idea? (I always blame the Americans first and actuaries second)



Liquidity is not fixed and can vary depending on willing buyers and sellers in the market so is often only available in rising markets. Therefore there is no guarantee a house is a liquid asset all the time either.


John Bolch of Family Lore posts regarding the One Law for All Campaign against Sharia Law in Britain launch at the House of Lords. The campaign is seeking legislation to curb the influence of sharia law in Britain. You can add your support by signing the Sharia Petition.


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Pensions Guide

Pensions in divorce is something I've been meaning to blog about for some time, but if I'm honest I keep putting it off because it isn't my favourite topic. As far as I'm concerned a 'critical yield test' calculates the performance of chips in a finished wafer (referring to electronics, not my culinary skills!) rather than calculating the investment performance of pensions. Anyway a while ago Peter Moore of Bradshaw Dixon Moore sent me the interesting Pensions in Divorce Guide which explains how pensions are dealt with at each stage of the divorce process. There is also a Pensions in Divorce Guide for Clients available to download at The Ancillary Actuary which does a far better job of explaining pensions than I ever could.

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