Pensions when divorced

Dory15032011

Hi, I'm really struggling to get information regarding my share of pension from my ex husband.
We was married 22 years with now 3 adult children...it was an amicable divorce 2 years ago with no property or monies to divide, my ex has assured me when he is able to cash in his pensions he will make sure I get my share he is 50 years old next year. I would like to cash in my share now as I am struggling financially but I feel he is being uncooperative and I don't think he has even contacted the pension companies for any information regarding my share, I have spoken to 2 different family lawyers who to be honest where really unhelpful and feel like I had wasted my time...is there anyone who has been through the same thing who can advise me as to whether or not I can cash in my share and have it put into my bank.
Thank you for any information that may help.
Lisa

AnotherJoe

He won't be able to cash in a pension because you cannot access the money until age 55. The best that might be possible would be to have half of it (assuming that's the split agreement between you ) transferred to a new pension in your name, but it still won't be accessible to you until age 55.

It depends what type of pension(s) he has and how it's payable, some schemes you may just get it paid to you direct others you'll get a lump sum, may be both.

So for the next five years you'll have to work out some other financial arrangements to get by. As you seem to still have an amicable relationship, especially bearing in mind that whatever he is doing, he isn't stopping you accessing the money since it's not accessible, why don't you say you'd like to sort out the pensions split now so that you can make plans for how to cope until that money is accessible. That would be in his interest as well.

princeofpounds

As stated, you are currently expecting him to do something he can't actually do (which may account for why he doesn't seem to have been too focused on it!)


Remember that 'cashing in' a pension is not straightforward even when you do reach the required age.


A lot depends on what sort of pension it is (most importantly, is it a defined benefit scheme, or a defined contribution scheme? Can you tell us?).


It will also depend on what your actual plans regarding the split are, given that he will have probably continued contributing after the divorce.


Are you supposed to get half the value of the pension at the time of divorce? (with presumably uplift from investment over the subsequent time period, if applicable)


Or are you supposed to get half the value of the pension at the time he retires, acknowledging he is likely giving you some extra contribution over time?


Also, did you have a clean break financial settlement order as part of your divorce, and what did it say?


Some types of pensions it would have made sense to split around the time, others have to wait. No type of pension would be available to you right now however (unless you are much older than him). But whatever the situation is, you both want to have a clear and mutual understanding of what it is.

bigadaj

Dory15032011 wrote: »

Hi, I'm really struggling to get information regarding my share of pension from my ex husband.
We was married 22 years with now 3 adult children...it was an amicable divorce 2 years ago with no property or monies to divide, my ex has assured me when he is able to cash in his pensions he will make sure I get my share he is 50 years old next year. I would like to cash in my share now as I am struggling financially but I feel he is being uncooperative and I don't think he has even contacted the pension companies for any information regarding my share, I have spoken to 2 different family lawyers who to be honest where really unhelpful and feel like I had wasted my time...is there anyone who has been through the same thing who can advise me as to whether or not I can cash in my share and have it put into my bank.
Thank you for any information that may help.
Lisa

You should have a legally binding agreement set up, this will cost you money in legal fees but is the only way of gaining certainty, otherwise you may be wrangling for years and both have different opinions of what you consider to be fair.

You can't access pensions with a few exceptions until you are 55, if you then take is as cash you will lay a large amount of tax but that's your call, all I'd ask is after you do this don't come Back he and complain after you've done this without either researching or paying someone to do it for you.

brewerdave

If the divorce was a "clean break" one, then as far as I'm aware, you have no legal claim on your husband's pension. If the financial issues weren't finalised then some recent Supreme Court cases indicate that you might have a claim, but as per others normally this would result in a seperate pension for yourself rather than a cash sum.

mgdavid

Dory15032011 wrote: »

......it was an amicable divorce 2 years ago with no property or monies to divide, .......

pensions are money??
this should have been discussed, agreed and put onto a legal footing 2 years ago.
Others have asked various pertinent questions, cannot really comment without the full facts.

Bootsox

Five years is plenty of time for him to meet somebody else and be persuaded that handing over half his pension isn't such a good idea.

Aretnap

Indeed, what happens to the pension is something which should have been agreed as part of the divorce settlement. If it wasn't, you may be a problem.

The possible ways a pension might be dealt with in a divorce are outlined here - do any of them look like something you agreed to? https://www.moneyadviceservice.org.uk/en/articles/dividing-pensions-on-divorce-or-dissolution

jamesd

Dory15032011 wrote: »

my ex has assured me when he is able to cash in his pensions he will make sure I get my share he is 50 years old next year.

The type of pension that is available at age 50 normally doesn't have a full cash value, instead up to 25% of it could be taken as cash. The remainder has to be taken as an income. These are defined benefit pensions like final salary. If age 50 is not the normal retirement age for the pension there is normally a substantial reduction in the amount paid for taking it early.

Your ex can't take the money before age 50 even if he wants to because the law doesn't allow it. Even 50 is a protected benefit for existing schemes that is no longer available to new ones.

It is possible to transfer such a pension to a personal pension if an independent financial adviser agrees that it is the best course. It usually won't be. The protected ability to take money at age 50 will be lost if this is done and the lowest age will rise to 55.

Dory15032011 wrote: »

I would like to cash in my share

You probably don't have a share. Ideally if you had made proper arrangements some of his pension would have been switched into your name and you would have a completely independent ability to decide when to take it, still subject to the legal age limits. A pension firm will not do this just because they have been asked, they will insist on an order from the court that is dealing with the divorce.

As it is you may be reliant on his goodwill and may lose all money from it when he dies because that's the usual treatment. His spouse at the time, if any, might get a spousal payment for the rest of their life. You, as a person who is not his spouse at the time, won't.

Dory15032011 wrote: »

I feel he is being uncooperative

It's illegal for him to receive any payment until he reaches 50 unless he has been diagnosed with a medical condition that gives him a life expectancy no higher than a year or unless, sometimes, he's too ill to do any work. Any delay at present makes no difference.

Dory15032011 wrote: »

I have spoken to 2 different family lawyers

Some idea of the total pension value would be useful to help to assess whether there's anything worth splitting. You two together would need to go back to the court and ask for the court to change the financial settlement to allocate part of his pension to you, in your name.

Avoid the "earmarking" approach because this is the one that causes you to lose your income from it when he dies.

Solicitors normally want to be paid and there is clearly no money here to allow you to pay them. You have financial trouble and even if they changed the order you couldn't get at the money to pay.

Getting him to cover it, with the costs deducted evenly from both of you, is the way forward that is most likely to get you some money, in about six years. Six is assuming that you are ineligible for protected age 50 because that was ended for new joiners to pension schemes before the divorce.

Depending on the value of the pension it may be cleaner all around for him to just agree to pay you a lump sum or some regular money at this stage, given the mess made so far by not getting things tied up properly initially. But to do that you'd need to know the value before the marriage and the value at the end of the marriage to work out the increase (and the rules beyond that vary depending on which UK sub-country you're in, it might be all not just the increase that you could get half of). Also worth knowing that the pension statements would normally give a value if taken at retirement and that value is not the cash equivalent transfer value (CETV) normally needed for these calculations. Only the pension provider can calculate the CETVs needed. A typical CETV might be 28-35 times the income if the transfer was done at the normal retirement age. A transfer before normal retirement age would be less.

mania112

If your share ends up being a pension (which it should be because your ex would have to wait until age 55 and then pay tax on withdrawing it as cash) the question is how old are you? You will have to wait to age 55 too.

It seems your ex is under the impression a pension can be accessed at age 50, that is no longer the case for 99% of pensions.

A pension should not be considered a way to solve short-term money problems.

How much is the pension worth?

I suggest going to Citizens Advice and seeking assistance on ensuring you are claiming the right benefits. If your ex-husband has no other assets, the divorce settlement isn't the answer.

KNJ_2

I might be mistaken, but if his pension is from armed forces, cannot that ( dependent on scheme ) be paid at 50?