Discuss divorce related pension issues. Is the CETV valuation valid for final salary schemes? How much is a pension worth when you offset it against the house?
My Husband has been divorced for three years now, the pension sharing has all been concluded.
We just wondered if you could answer this question for us. It was a friend that asked this question, we had not thought about it before, but are curious as to what would happen if my Husband's ex died before he did. He took his pension early and is receiving it now. He is 57 and his ex is 47. A percentage is being deducted each month to go into his ex's pension pot, and he receives a monthly payment.
Would the amount that is deducted each month for her be added back on to the monthly payment to my husband?
thanks Zara
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From what you say, as a deduction is made from his pension it sounds more like pension attachment than a pension sharing order. If it is attachment (these used to be called earmarking orders) then it ceases to have effect on the remarriage or death of the recipient. Therefore, if she dies before him the deduction from his pension will cease and he will receive the full amount.
Pension sharing orders were introduced in 2000 as an alternative to earmarking because they provide a desirable clean-break. Consequently, pension attachment (earmarking) orders are now less common although they still have their place, particularly in circumstances where the rules of the scheme allow a member to retire relatively early and/or the ex would not receive a pension until very much later.
If it were a pension-sharing order, a one-off debit would have been made against his pension “pot” to create an entirely separate but corresponding pension “pot” for her. Under pension-sharing orders, nothing changes at all on death or remarriage. However, if a pension-sharing order had been made on your husband’s pension, his ex would not have been able to receive any pension from her “pot” until she reached the scheme retirement age (probably 60 or 65).
I hope that this helps rather than confuses!
Peter.
P.S. There are some exceptions to the retirement age limitation for the recipient under a pension-sharing order. However, it is an unwarranted extra complication in this context.
It is a pension sharing order, she can take this on my husband's retirement age, 60. He is a teacher. 36% has gone into the pot for her.
So where does the money go???? my husband has been building up his pension 30 years? If she is not there to receive it, who does? It is approx £300 per month that has been deducted for her from his monthly pension.
His pension was £160,000 so it will have been reduced by 36%, that is a lot of money to disappear if she is not there to receive. Strange
Cheers Zara
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Some defined benefit (salary related) pension schemes do not grant dependants benefits to pension credit members (the recipients under pension sharing orders). Offhand I cannot remember what the Teacher’s Pension Scheme does in this respect. Assuming there are no dependants benefits, the money just remains in the scheme for the benefit of all the other members.
Who ever said that life and pensions were always fair?
Hi Peter You are right there, definitely not fair. So in a nutshell, he gets penalised and would lose £300, period, for the fact that his ex, could not keep her p***s on, had another baby, and is with another bloke, and probably will benefit from his pension too.
Her infidelity will subsides other people!! Crazy
Would it be worth contacting Teachers Pension to ascertain that this is the case.
Thank you for your help Peter. zara
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Hi Peter There is a webiste, but he needs a password etc, which they are sending to him. He is going to phone them on Monday just to clarify the position.
As I said it was a question from a friend of ours, and when you think about it, why should he be penalised after putting into the pension, together with the government for 30 years. That in effect is his money.
Will let you know what is said as it is quite an interesting situation.
Zara
ps just imagine if you are married quite a few times and have a piece of each ex husband's pension. Be set up for the duration of your old age.
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