Pension Sharing

Ex has three pensions and my new solicitor has suggested that judge may order the transfer of one of his pensions to me to balance the books.


If this were to be the case would I receive the same monthly payouts as ex would. My understanding is that if a pension share is awarded then my payments would be considerably less than ex's.

Also would I be offered the same lump sum that ex would with a pension transfer.

Hi,

It is difficult to be certain without a little bit more information, however, I would comment as follows:

Usually there are charges on pension sharing so transferring the whole of one to you is often a sensible move from a cost perspective. (1 set of costs v. 3)

You are unlikely to receive the same payouts as your ex (due to differences in sex, age, etc.) if you split the total CETVs 50:50. Once the split has occurred to his pension he will receive less.

If you are looking for equality of income you may need more of the share to achieve this. Basically, it costs more capital to provide a pension to a woman than it does to a man (its a longevity thing!).

Difficult to answer the last one without knowing the terms of the scheme. Basically, if the pension you share from is NOT in payment to him then you can have a lump sum. If he has drawn the pension already you will not be able to draw a lump sum.

Have you looked at equality?
Have you reviewed the three pensions and worked out which one should be shared?


Regards

Phil

Although I am a Resolution Accredited Independent Financial Adviser my comments are given here as general guidance based on the (often limited) information available and does not constitute financial advice. They should not be seen as a substitute for detailed financial and legal advice.

Phil

I am interested in your reply and I apologise for highjacking the post. The point which caught my eye was the percentage split would be higher for the female than male. My pension was valued at twice the amount of my husbands being 152,000 and his 69,000. I assume i would have to share this with him even though he couldn't be bothered to continue to pay his because he said he could not afford it. I am 53, he is 47, would I have to give him 50? many thanks.

Hi,

Hijack away.

The normal starting point for a pension share is 50:50 of the capital value (CETVs).

Then you are looking for reasons why it should be more or less.

First check should be whether both CETVs represent fair value. They can often be undervalued and this could impact upon what the shares should be.

Second, a 50:50 split rarely gives equality of income because it costs more to provide a pension to a woman than it does a man of the same age. Annuity rates differ for this reason.

In your case, it is likely that you will have to share given the greater value of your pension and the issue above is less of an factor because you are 6 years older than he is.

A pension sharing report would highlight the actual % splits needed to provide income equality.

Regards

Phil

Although I am a Resolution Accredited Independent Financial Adviser my comments are given here as general guidance based on the (often limited) information available and does not constitute financial advice. They should not be seen as a substitute for detailed financial and legal advice.

Thankyou very good explanation