Pensions are often seen as a bit of a mystery, with many people not realising their true value, but in reality, your pension is probably one of your most valuable assets. It is usually the second largest asset in the marriage after the matrimonial home. During a divorce or the dissolution of a civil partnership, the value of your pension assets will have to be taken into account as part of the financial settlement process.
I often talk about cutting down on unnecessary spending (the coffee on the way to the office; the sandwich from the sandwich shop when you could have made one at home) and I am all for building up savings. But in lockdown Britain we may have gone too far, become too risk averse, and that could be to our detriment in the future. Let me explain why I think that.
We are all aware of the considerable volatility the coronavirus has caused in the financial markets. Many people, particularly those without a financial adviser, are likely to be feeling anxious about the value of their pension savings falling and may even be re-thinking their retirement plans.
As a self-employed barrister Mr J, aged 33, had a hectic work schedule, with little time to think about his own personal finances.
Having set up the business two years ago, he was busy building up a pot of money for the company and didn’t have time to make sure the right personal protections were in place to support his wife and young children. It was important to Mr J that he knew how to maintain a good standard of living.