IFA made a mistake.

Malthusian

silvercar wrote: »

Working out the exact loss will be difficult as my husband can't add more than a certain amount each year to his pension.

Am I right in inferring from this that there are contributions going into the plans? That does make it slightly more complicated. If there were no contributions or withdrawals you could just work out the annual growth rate you've each experienced since the mistake, swap them around and apply them to the other's starting value, and compare the difference.

If there are contributions or withdrawals it is still not a difficult calculation - an hour's work with Morningstar and Excel for someone who knows what they are doing.

His contribution limits don't come into it because he would have paid the same into his pension whether he was invested in the right funds or not.

silvercar

His contribution limits don't come into it because he would have paid the same into his pension whether he was invested in the right funds or not.

I see that, but we can't now put any compensation into his pot (for it to grow as it should) due to the limits.

Malthusian

silvercar wrote: »

I see that, but we can't now put any compensation into his pot (for it to grow as it should) due to the limits.

But if he pays you the amount you have lost within your pensions into your own pocket (which I don't think is taxable), you have had what should have been growth within the pension paid into your own pocket, without tax being applied.

GDB2222

If you are getting the compensation paid as cash to you personally, it would be reasonable to give some discount. After all, if you were to pay the cash in as a pension contribution, you would get tax relief.

In divorce cases, comparing cash and other assets against pensions, it's quite common to apply a 20% to 30% discount to the pension value.

SC, is the amount of compensation likely to be big enough to involve the IFA's insurers? That would make a difference to how quickly the IFA is able to act.