Perhaps the glaring antithesis of the marriage to the happy image omnipresent at Christmas becomes just too painfully obvious. Or the elongated seasonal break forces an already fragile structure to fracture irrevocably, but as the crowds rush to the January sales, solicitors have come to expect their own queues - of those instigating divorce.
The current situation is one of "all change". When the Family Law Act of 1996 is fully implemented (probably not until around 1999) arrangements over finance will need to be resolved before a divorce is granted. North of the border, family and divorce law remains distinct, and the Family Law (Scotland) Act sets out principles to guide the courts in making financial orders.
Meanwhile, Mr and Mrs K, from London, in their thirties with a child at private school, have joined the seasonal surge. There is a family home - with a mortgage - one private car, one company car, a portfolio of shares, one joint and two individual bank accounts, a number of insurance policies, plus modest savings accounts. Mr K pays into a private pension scheme, Mrs K has no fund of her own. Like many couples they have built up their own particular financial profile of debts and assets. Mrs K feels particularly vulnerable, not just regarding pension provision, but since she also feels less au fait with matters financial.
One course of action is to enlist specialist services. Hill Martin Financial Management, for example, have a Matrimonial Litigation Support Service, which offers independent advice tailored to the individual - including their lifestyle and risk profile. But is this a luxury, the preserve of the super-rich? "Absolutely not," says the group's Mark Ormerod, who suggests a threshold figure of around pounds 100,000 in assets. An initial no-cost meeting analyses a client's situation, and a fixed fee is quoted. Duplication is not an issue. "We are not in the role of solicitors, nor do we get involved in negotiation," says Mr Ormerod. For example, if some of the share portfolio is in Mr K's name alone, and Mrs K suspects that her husband is attempting to dispose of them, advice and action would strictly be the domain of her solicitor. "Our role is to assist the client clarify the current situation - and to plan ahead. As the divorce progresses from the pre to the post-settlement stage priorities evolve to making the best of the settlement - and adjusting to the financial constraints imposed by it," adds Ormerod. "We can also attempt to minimise the tax consequences of longer-term decisions."
Such groups will have a team of specialists in different areas, with the most appropriate drawn on as required. In essence they, plus your solicitor, form a temporary, complementary team that specialises on your particular case. Indeed, many solicitors who feel out of their depth in the murky waters of pension valuation have themselves been utilizing the services of organisations like Hill Martin. Other organisations who will perform valuations include the Divorce Corporation (for other "professionals") and the Society of Pension Consultants.
Pension valuation remains an issue not yet satisfactorily resolved in the larger, ongoing story of pensions in divorce. Pensions can be the major asset when equity in property is low. (In Scotland things are simpler, a spouse is entitled to a share of the contribution made only during the marriage.)
Current regulations define the value of a pension as the "cash equivalent transfer value" - equivalent of how much a pension scheme holder would be paid if they were to transfer the money from the current to another pension fund, although, according to Helen Carlick, author of The Which? Guide to Divorce, this valuation method can undershoot the real value, especially of occupational (as opposed to personal) pensions.
Courts can now "earmark" - set aside - a share of a spouse's pension. Counter to the concept of a clean break, there are problems too with the death of the pension-scheme member pre-retirement, or the remarriage of either partner. A system of compensation is often preferred, and while a judge cannot get into the pension fund itself, he does have the power to redistribute other assets.
Well and good in theory, but financial constraints can mean that no money is actually available. Pension splitting (the allocated pension share remains in the scheme) has its own supporters, including lobby group Fairshares among others, but the debate continues, and it is not presently an option.
Finally, if the division of any of the assets becomes too fraught during the negotiations, mediation, where participants are encouraged to make informed decisions and negotiate agreement, may be a way out of an impasse.
Bone up with specialist publications: The Which? Guide to Divorce has chapters on `Financial Planning for Divorce', `Money in Divorce' and `Pensions', and on the situation in Scotland. pounds 10.99 p&p free, call 0800 252100. The Finance of Divorce, by Peter Vaines, publisher Pan, pounds 6.99.
A checklist of assets is a good way of getting organised - include property, vehicles, valuables; occupational pensions, superannuation or personal plans; any compensation paid for having been mis-sold a pension; current and savings bank or building society accounts; stocks and shares, unit trusts, PEPs, Tessas; life insurance policies, and redemption values of investments yet to mature.
With their specialised knowledge the services of a financial management group could be useful. The more accurate the information you give on the range and value of assets, the more focused and valuable the service to you.
Try to agree as much as possible with your spouse. Fighting over every little aspect is costly, and can result in a downward spiral where what is in the "pot" is even further reduced.
The Divorce Corporation: 011462616 Family Mediators Association: 01273 747750
Hill Martin Financial Managements:
London office: 0171 233 2777; Bristol office: 0117 927 9985; National Family Mediation: 0171 383 5993. The Society of Pension Consultants: 92 Fleet Street, London EC4Y 1DH (written inquiries only).Reuse content