Pensions & Divorce

Wednesday, 14th July 2010 10:39 - by Resident IFA

I received a visit last week from a lady who had recently divorced. I say recently, although it was 2 years ago... ...and she has not yet organised the destination for the half of her ex-Husband’s BT company pension she was awarded (via Pension Sharing Order) as part of the divorce settlement. By ‘organised’, I mean making alternative pension arrangements for the monies. Of course, BT are not allowing her to become a member of their pension scheme. Instead, they require her to move the monies to a suitable alternative i.e. Group Personal Pension, Personal Pension, or Stakeholder Pension. The potential Client had a female friend with her when visiting me. The friend conspiratorially asked “Come on. As this first interview is free of charge, who’s good at the moment to put the money with?” I am sure she winked when saying this. This is actually quite an understandable thought for someone coming to this topic fresh, but somewhat wayward. Providing advice to her could not be done ‘there and then’. It is a far more in-depth qualitative process to aid the Client having the very best pension and provider for now and the future...as opposed to what horse is in-form and might do well in the 3.15 at Haydock Park! There are many parts to this, including risk assessment, asset allocation, product flexibility, product charges, the Client’s explicit goals, etc. etc. All-in-all, this may well take three meetings to get from A to Z and leave the Client with a pension that I am confident will be suitable for her. So, the cracked record comes out of the sleeve again (!)...seek the advice of an IFA (Independent Financial Adviser) if you find yourself in a similar position or have pension planning needs. They will offer a whole-market perspective (double-check this) and should be able to undertake the rigorous qualitative assessment needed to help you take the right course of action and make an informed decision or two. Sermon over! Until next time...