Army pension

Ancillary Actuary website :
www.ancillaryactuary.co.uk/home/2008/12/...lose-out-part-3.html

"When determining the percentage of the CETV to share to the spouse (or value on pounds in Scotland), then the natural assumption is that if you want 50% share of the pension then you determine a 50% share of the CETV.

Natural, and as often with pensions, wrong. In most cases 50% of the CETV will provide less than 50% of the pension value to the spouse.

Although this will not be obvious at date of sharing, it will be when pension benefits become due. It is a catastrophic failure of pension experts to communicate this issue to legal professionals. A failure that is penalising wives every day."

Is that not true for AFPS pensions Phastasphuk ?

You raise a good point, I am no expert but i do know the Army pension is unique in as far as there is no actual cash pot it is calculated on a percentage of a generic pay rank on discharge, and is index linked, so this would make it hard to value.
What i don't know is how this affects the sum to a spouse when it finally comes into payment.
If it isn't index linked from the point of sharing then this could have a serious effect on the payment to the spouse as this could be up to 20yrs plus in the future.
Maybe someone could shed some light on this.

Hi
To be able to expect an equeal income an actuary report will need to be done i think I am right in saying that .

I think that 50 /50 does not necessarily mean an equal split in the greater scheme of things ie my half will not generate an income as high as my spouse as a woman we tend to live longer so the income received will be lower.

CETV i dont think was designed for pension sharing..


I am still trying to learn about these things so if i am wrong on any of these points please can someone put me right .


Dido

I am going to play devils advocate here for a minute...
On divorce, assets are split on what value they have on the day of the Consent Order, so if in the future the value increases or may be worth less, should that be taken into account ? For a house it isn't, for stocks and shares it isn't, for money in savings, future interest isn't, so should a pension be valued any differently ?
The other point is that if the pension is in payment to the ex soldier he would have to take a huge hit on his pension monthly amount now to pay for that equality in 20 plus years is that fair when you take into account why soldiers get a pension earlier than normal?
Now i am not against pension sharing, far from it, but there are two versions of "fair" and from a straw poll it seem that judges go for the "percentage thing" at point of division,as that fits with the normal division of assets.If not you could have a scenario where the FMH was split 50/50 and the spouse stayed put in an appreciating asset and had a 70/30 split on a pension to give equal income at 60 and the ex soldier had to rent and had a very low pension.Is that fair? or should he have a claim on the future value of the FMH?

hi ya Phastasphuk

how are you ???

I dont think any thing is fair where money is concerned I have said this time and time again but you do bring up some very good points.

All i know is with me personally i need to be fair to my self but at the same time being fair to my s2bx and for me being on equal footing income wise i see as very fair for us both long term

May be not on the surface but with in the greater scheme of things may be not at the moment the pension is shared but when we both hit old age.

My circumstances are different to say somebody else so I do know that when there are other assets some times fairness is not always as fair to one as to the other.

I am not even sure if I can or indeed get an equal income but it is some ting that i would like to look into .

And if it can be achieved how can it be achieved fairly from the point of view of the solider and from the point of view of the wife as we both are equally going to grow old and both will need to take our future and our needs for that future into account .

Its a hard one how do you achieve fairness in these situations and what is fair and what is reasonable.

What ever the circumstances there is always going to be an issue to what one considers fair to what the other considers fair.

All I know is dont want to be greedy so surely equal income would mean just that no one better off than the other both exactly the same to me that seems fair but I would like some feed back on this as I really am struggling with what seems fair and reasonable to me may not be to some one else.

But if I am given a percentage say 50 / 50 CETV then that too is fair percentage wise but looking to see if there are other options and seeing if there are other ways to achieve what you both need in the future pension wise can only be good for both of us .

We do also have to consider that he will be drawing his pension long before me which means he will have a little extra than me to live on I will have to wait till I am 65 so that can be considered most unfair also so its a lot to take in and there is a lot that has to be considered in the name of fairness especially to both spouses .


What i really need to find out is is the pension always split on a percentage and can you ask for equal income and if you can how can this be fair to both parties or indeed is it not fair to one but fairer to the other ect so many questions

Now I am going to get a new spade as i think I may of dug my self a hole a big huge one can some one help dig me out or have I just buried my self for ever xx

dido xxx

Hi ya didojane,
I am fine thanks,I know what you mean Fair and reasonable for one may not be to another and i think that divorce is fair and reasonable to no one, there are no winners only lossers in this game. we just have to make sure that it is as fair as it can be, and that one partner is not favored due to bullying or lack of legal help, and then we are in the best position to move on.

Plus there is always SM to give you some income until the pension kicks in.