Pension sharing/actuary

[Teaformetoo]

Sorry if this has been asked before. Trying to sort out the financials - everything fairly amicable aiming for 50:50 split. My solicitor is recommending we appoint a pensions actuary to sort out the pensions. Quoted £2-4k to get the report, cost to be split. What are the implications on sorting it ourselves e.g. dividing the larger pension so we both have the same amount in our pots? Is this possible? Should I just pay the money? Am really keen to get it all done and apparently these reports take months to prepare. For context 20+ year marriage, around 150k in difference between each pension.

They don’t take months in my opinion but our judge was very clear that the are mostly a waste of money and we had a bigger pot to split. You’ll spend all that money and they will suggest a 50.25 to 49.75 split or something similar. Maybe worth it if very different ages? But otherwise just calculate the 50:50 split yourselves.

The Pension capital does not reflect the true value of a pension. The true value is the income each pension will give you in retirement. Only a pension actuary can calculate this for you. £1-2k each is a lot of money but it could cost you far more than this in lost pension income if you just split the capital as suggested. A pension report is an essential investment given there is a £150k gap between you (so assume the pensions are of reasonable value). Think longer term!

Sorry but this is potentially bad advice and I would be very surprised if a judge said they’re usually not worth the money! Pensions can be complex. But whether you need a report depends on the kind of pensions you have. It’s correct that in some cases you don’t need one but depends on your pensions. Who are they with and what are they roughly worth? And how many different pensions?

The pensions advisory group recommend using a pension expert if the pension have a Value of over £100k. If one is a government pension or defined benefit it’s even more important

If you have actual pension values, are these defined contribution pensions? It's only worth even considering anything from an actuary if there are defined benefit pensions, typically in public sector and finance and some larger companies. And, even then, may not be a good use of funds.

Thanks for your responses, I really appreciate it. So mine is a defined benefit pension and is the larger amount. The responses here are exactly why I’m confused- such varying viewpoints!

It’s definitely in your ex interests for you to get a proper valuation. They 150k difference could well be much more considering it’s defined benefit. You can’t just take the pot value and divide by two.

Any outcome will also depend on what each of you is trying to achieve and what other assets are available (house, savings, etc) and your ages, and any children involved in this. But with a large pension it may be more likely that a pension sharing order is appropriate (i.e. he becomes a member of your scheme with an earmarked share). Otherwise you might end up transferring him a lot more housing equity or other assets.
PS. Hope not Teachers Pensions as they seem to take the longest!

I've literally just had this conversation with my solicitor. My pension is in payment but my STBXW won't be in payment for another 18 years or so and as it's pension income that's important, an actuary is needed to understand how her pension pot will look when it begins payment.

Yes teachers pensions!