What is a pension report and when is it needed?

Pensions are often the most valuable assets in a matrimonial financial settlement case. However often they are overlooked as parties focus is often on the ‘former matrimonial home’ and meeting the immediate financial needs of the parties and the children of the family.

It is important that both the short and long-term needs of the parties are considered as part of the overall financial settlement.

Cash Equivalent Transfer Value

It is important to understand the values of the pension assets and this is why solicitors ask the parties to disclose their cash equivalent transfer values (CEV or CETV.)

Often these figures alone will not give sufficient information to determine whether and how a redistribution of pension assets known as ‘pension sharing’ is appropriate and how the pension assets should be shared in order to achieve either equalisation of CETV’s or income in retirement.

When is a pension-sharing report required?

In cases where there are defined benefit pensions, the CETV may not represent the “true value” of the pension. Other circumstances where a pension report may be required are as follows:

• Defined contribution pensions with hidden values or other complicating factors;
• Where parties are seeking an equality of income in retirement where there is a significant age difference between the parties;
• Where either party has a serious  medical or health issue;
• Where pensions have been accrued prior to the parties relationship and marriage

When would a report not be required?

A report may not be required:

• Where the pensions are uncomplicated defined contribution pensions;
• Where the values are modest in relation to the overall matrimonial assets;
• Where there parties are in their 20’s or 30’s and have had a relatively short marriage.

How can we help?

It is important to remember that each case and set of circumstances is different there is no “one size fits all” therefore it is extremely important that, if there are pensions, you seek early legal advice. At Browell Smith & Co, we aim to provide clear and tailored advice and assistance in respect of your specific family circumstances. Our family law solicitors are highly experienced in this area and are able to advise and assist you in instructing a pension on divorce expert to produce a report should it be deemed necessary in your case.