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Topic:
Actuary report costs?? (15 Posts)
Started By:
Date:
15 October, 2012 08:36PM
Actuary report costs??
whatalife - 15 October, 2012 08:36PM
Got as far as Decree Nisi, exchanged Form E's and now starting finance settlement proposals. It's a long marriage of 30 years during which I've been the only earner. Children all adult now, a house to sell around 250k with a mortgage of 80k. My pensions have a transfer value of 400k. By the sounds of it I'm probably not going to see much out of the house equity, will be paying maintenance and a pension share. Doesn't seem much left! Solicitor has asked me to pay for an actuary report on the pension to help decide the split , but suggests it will cost around £1400 although I'd probably pay half. I'm now running out of money to pay all this and wonder if this is really necessary or seems expensive? I've no idea where to pitch a proposal so maybe it's needed? Appreciate your thoughts...
Re: Actuary report costs??
davidterry - 16 October, 2012 08:26AM
Don't spend money on an actuary's report unless a court has actually directed that one be prepared. Courts are mindful of the costs so it is not something which is routinely done. The cost needs to be proportionate to the issues and there has to be some good reason for doing it.
Re: Actuary report costs??
whatalife - 16 October, 2012 10:48AM
Thank you for the advice, I think the solicitor asked for it so it makes it easier to know where to start negotiating.. i'm really in the dark on where to start that. My thoughts are maybe to not take any house equity so it will leave her enough to buy a 1/2 bed with no mortgage as she will struggle to earn enough at 55 to get one. But where do i start with an 'offer' on the maintenance and pension share? is there some guidelines of whats likely? my understanding is that if we can agree it then goes to court for approval so it needs to be somewhere close (plus i need something to move on with!) i'm doing my best to be fair to us both but i dont have unlimited funds and every little saved on the process helps. Thank you.
Re: Actuary report costs??
davidterry - 16 October, 2012 11:33AM
Well, how old are you and how old is your wife? Also, how much do you earn approximately? This is the missing information which will very likely affect any answer.
Re: Actuary report costs??
whatalife - 16 October, 2012 12:55PM
i'm 55 she's 54. My income is close to £80k. Since seperation in 2008 ive been paying her costs to stay in the house. I need to get it sorted and should have done it earlier i know but hindsight is a wonderful thing.. in trying to do the 'right thing' its probably made it harder. Its not sustainable and the sooner I can move on and make some sort of recovery both financially and emotionally the better. The fees so far have pretty much emptied me out of any savings hence my concerns over the report costs..
Re: Actuary report costs??
davidterry - 16 October, 2012 02:14PM
Well, you have a problem on your hands. This is a long marriage, your wife has never worked and she is 54. You are the only one who is earning and you are the only one with a pension. What you have to ask yourself is what proposal you can make which (1) provides for the accommodation needs of your wife, (2) provides for her income needs both now and upon retirement and (3) which is also affordable for you and provides for your needs. It is a hard circle to square. Possibly going to mediation might help?
Re: Actuary report costs??
whatalife - 17 October, 2012 11:29AM
Mediation isnt so easy when we live in different parts of the UK. Also i'm pretty sure they would only facilitate a discussion and what I need is a practical indication of where to start the negotiations. This seems to be a spreadsheet exercise so maybe I need more financial expertise rather than perhaps a legal one? I'm the one still paying for mortgages etc probably well into my retirement where my wife will be debt free and happily drawing on my pension... all very frustrating!
Re: Actuary report costs??
davidterry - 17 October, 2012 01:51PM
>>>This seems to be a spreadsheet exercise so maybe I need more financial expertise rather than perhaps a legal one?<<<

No, no, no and no. Accountants and financial advisers don't have a clue about divorce law. They are the people responsible for advice such as 'put your savings into your wife's name to take advantage of her lower tax band'. They give little thought to divorce law and the principles that a court would use in the event of divorce. That is very much not an accounting exercise.
Re: Actuary report costs??
whatalife - 18 October, 2012 09:08PM
Well it seems that not much progress is going to be made unless I get the report done as solicitor basically doesn't know where to start on the split without it. Surely there must have been others in similar situation to provide some idea?
Re: Actuary report costs??
davidterry - 19 October, 2012 11:37AM
Say there is one pension held by the husband which has a capital transfer value of £400K, which has been built up during the course of the marriage and the marriage is one of 30 years. It does not require an actuary to say that 50% of the husband's pension should be transferred to the wife by way of a pension sharing order in order to achieve equality.

Now, an actuary can say all sorts of fancy things like, 'Oh, the wife is 55, the husband is 57. In order to achieve equality of income at age 65 (say) 67% of the husband's pension needs to be transferred to the wife'. There are no end of different ways of looking at these things and the answer will depend upon what you are paying the actuary for.

In reality the courts take a broad view of settlements in the round. They look at income, capital and pensions as a whole. Pensions are not considered in isolation as an actuary looks at them. Nor are the capital assets of a marriage divided on actuarial terms.

Before anyone pays out for an actuary's report they need to be quite sure that there is some benefit in it for them and that the costs are proportionate to what is at issue. Actuaries' reports are not cheap and in many cases 30 pages of 'assumptions' does not ultimately amount to a heap of beans because courts look at things in the round.
Re: Actuary report costs??
whatalife - 14 January, 2013 03:57PM
Well things seem to be going round in circles. My solicitor won't advise on a pension share without the actuary report and I simply don't have another £1400 to throw at it. So far I've spent almost £4 k to get to Nisi and some loose proposals. My situation is house will have around £150k of equity on its sale which my wife will need almost all of if not all to buy another one with. That means that the pension share will need to take into account that i havent taken any capital out when its shared. Im also going to have to pay spousal maintenance to the tune of around £800 a month ( half what I'm currently paying ) I just want to get this sorted as its been going on for almost a year, yet it seems to be stuck as my solicitor asks what I want to do next??
Re: Actuary report costs??
davidterry - 14 January, 2013 04:58PM
To advise you your solicitor does not need an actuary's report. Your proposal to your wife could easily be, 'You keep the house and I'll keep the pension'. Alternative proposal from you - 'sell the house and split the proceeds 50/50, pension share of 50% in your wife's favour'.

If your wife does not like either of those it is for her, not you, to say what pension share she wants and why if it is not one of the above. If all we are talking about is proposals then that is all you need. Of course, whoever advises your wife may want an actuary's report to cover their own back but it is hard to see why it should matter as much to your solicitor. You are free to make whatever proposals you want and those would be the two basic ones (with or without modifications).
Re: Actuary report costs??
whatalife - 14 January, 2013 05:15PM
Thank you David, a 50/50 split on the house equity won't allow her enough to buy on with that's why I would agree to her having 100% and offset this with a reduced share for her of my pension. This has a £400k value. It's seems to be the only thing to play around with as the spousal maintenance is what it is and needs to be. I know a £1 of pension isn't the same as a £1 cash but wouldn't a starting point be to adjust the pension by a % value to give me back some of the equity? I.e 60/40 in my favour?
Re: Actuary report costs??
zookeeper - 07 June, 2017 01:18PM
I am so grateful to have found this thread as it is very close to my own situation. I shall not, therefore, agree to having an actuary report or even an EPV (worse?). I hope whatalife got sorted out and has moved on. I feel, like him, that my savings are being depleted; moreover the advice I am getting from my solicitor is not great, I feel, nor 'strong': it feels as if my STBX is walking over me again. Perhaps they only suggest options and I, as Petitioner, have to decide on the course of action.
Re: Actuary report costs??
zookeeper - 08 June, 2017 07:07PM
Having mentioned to my solicitor that I was not minded to agree to using an actuary, she has written to me to say that there is little to be gained by failing to cooperate if my STBX and her solicitor want to gain accurate pension information. I am now wondering if I have a decent solicitor.
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