Would it be wise to give up my di­vorce claim on my hus­band’s pen­sion?

Irish Independent - - Markets Business - Char­lie We­ston Your Ques­tions

QAFTER 24 years of mar­riage, I de­cided to sep­a­rate from my hus­band and we are now try­ing to come to an agree­ment on the eq­ui­table divi­sion of as­sets. We have two adult chil­dren who are still liv­ing at home. I would like to stay in the house and my hus­band, who is a di­rec­tor of a suc­cess­ful com­pany, said that I can have three-quar­ters of the house rather than half, so long as I give up any claim on his pen­sion. I am 52. I can af­ford the mort­gage on the re­main­ing quar­ter as I now have a part-time job, but I won­der if this is a good deal?

ATHE most heated de­bates in sep­a­ra­tions tend to be over who gets the fam­ily home or how it is split. And while this might ap­pear to be most peo­ple’s great­est as­set, many peo­ple for­get or ne­glect to se­cure an ad­e­quate share of the re­tire­ment pot.

Fre­quently, that pot is in the name of just one spouse and more of­ten than not it is the hus­band that has own­er­ship.

The stats show that, due to var­i­ous rea­sons (frag­mented ca­reer path, time out of work due to fam­ily con­sid­er­a­tions, lower pay in many cases), many women tend to have in­ad­e­quate pen­sion par­tic­i­pa­tion and con­tri­bu­tion rates, ac­cord­ing to CEO of the Ir­ish As­so­ci­a­tion of Pen­sion Funds Jerry Mo­ri­arty.

Un­der the Fam­ily Law Act 1995, the Fam­ily Law (Di­vorce) Act 1996 and the Civil Part­ner­ship and Cer­tain Rights and Obli­ga­tions of Co­hab­i­tants Act 2010, a court now has the power to treat a pen­sion as an as­set of the sep­a­rat­ing cou­ple/civil partners and or­der that it be di­vided into what­ever shares it con­sid­ers ap­pro­pri­ate.

Such an or­der is known as a pen­sion ad­just­ment or­der (PAO). For ex­am­ple, if one spouse has a sub­stan­tial pen­sion and the other spouse who worked in the home has no pen­sion, the court can or­der that part of the spouse’s pen­sion be paid to the other spouse or to a de­pen­dent child.

The court can also or­der that part of the pen­sion fund is split and placed into an­other pen­sion fund in the name of the other spouse/civil partner.

PAOs are typ­i­cally made in just 10pc to 20pc of di­vorce cases in Ire­land, even though over half of cou­ples get­ting di­vorced have at least one pen­sion.

This low fig­ure sug­gests that many di­vorc­ing peo­ple may not have prop­erly con­sid­ered the pen­sion as­sets.

Based on the de­scrip­tion of your hus­band’s job, it is quite likely that his pen­sion may be worth as much or more than your house, the best ad­vice is to get an in­de­pen­dent val­u­a­tion of the pen­sion be­fore you de­cide whether the deal is good or not.

QMY hus­band and I cur­rently have what I think is termed ‘joint’ mort­gage pro­tec­tion on our home and I know that if one of us were to pass away the other would be paid out from the pol­icy. But my brother said they have just taken out a ‘dual’ pol­icy which he said pays out twice. He was sketchy on the de­tails but he said they cost the same and I should look into it. Could you give me any fur­ther de­tails?

AA DUAL pol­icy of­fers pol­i­cy­hold­ers more fi­nan­cial pro­tec­tion at pretty much the same cost.

Dual cover is par­tic­u­larly suit­able where there might be chil­dren or de­pen­dants in­volved, ac­cord­ing to the chief op­er­at­ing of­fi­cer of Shea­han Fi­nan­cial, Joey Shea­han.

In the un­for­tu­nate cir­cum­stance that you were both to pass away it will pay out on two sep­a­rate oc­ca­sions – the mort­gage will be paid in the first in­stance, with a lump sum paid to de­pen­dants in the sec­ond.

It is not an op­tion with all in­sur­ers so you need to do some home­work, or get a bro­ker to do the leg work for you. Your brother is cor­rect, as the price dif­fer­ence be­tween the two is usu­ally quite small, so it is worth look­ing into.

QOUR house was bur­gled and an en­gage­ment ring be­longed to my de­ceased mother was taken. I am heart­bro­ken, but re­lieved that the thieves didn’t find an­other jew­ellery box with a few more pieces that had be­longed to my mum. We are about to put through a claim for the stolen items, but I am con­cerned about my mum’s ring. I ob­vi­ously don’t have a proof of pur­chase for this. Will the in­surer re­ally just take my word for it?

ADei­dre McCarthy of In­sure­my­house.ie says she has come across in­stances like this be­fore. In one par­tic­u­lar case a woman had in­her­ited a neck­lace from her mother thus didn’t have a proof of pur­chase or a val­u­a­tion.

She was able to source a pho­to­graph of the lady’s mother wear­ing the chain and on the back of this it was pos­si­ble to value the item and the in­sur­ers agreed to pay the claim.

This might be your only re­course in this in­stance.

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