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CETV question(6 Posts)
Hi all, my STBXH has now got his CETV and I have applied for mine. I had originally been sent a pension valuation which they ( pension providers) have now told me is not what I need to finalise the finances. Is a CETV generally lower than a pension valuation?
Could someone give me a glimmer of hope about this please?
Also, STBXH insists that the CETV is not factored into the division of assets. I thought it was. We have each got solicitors but we are working with a mediator to get the finances agreed. She is not brilliant if I'm honest, so keen to get advice from the experts on MN!!
Talk to your solicitor about this.
Yes a CETV value will be factored in to the division of assets, but it isn't a simple calculation. CETV is the cash equivalent transfer value, and is for defined benefit schemes (i.e. final salary). It is the pension valuation to transfer out in cash, and is determined by a whole host of variables, such as salary, years in the scheme, scheme rules and even things such as long term interest rates.
Cetv is worked out by pension actuaries and isnt open to debate, however a CETV isnt cash, as it isn't a liquid asset and will typically only be accessible years in the future (depends on your ages). Therefore it isnt as simple as just adding its value onto your liquid assets to divide them up. Typically you would apply a discount to the CETV due to its illiquidity. It can also be expensive to share the pension in terms of admin fees.
Try not to get an idiot as a solicitor - my ex wife spent 70k in legal fees chasing a completely unrealistic split of assets -- great for her solicitor, not so great for me, her, or ultimately our son. She ignored everything the mediator sensibly said regarding the financial split.
Your solicitor should be able to advise but do look into an actuary report if the pension is sizable. Make sure you fully understand the financials before any negotiations.
Thank you all. My head hurts .I'll see what solicitor says about this. Appreciate the responses.
Do your research on this.
My STBXH solicitor told him that the capital was worth 4 times the pension, ie. 100k in house equity is only worth 25k in pension.
I found an advisory document given to judges that suggests it is nearer 60-80k. I guess the figures vary depending on how old you are (we are 5 years off retiring), so I've suggested to him we split the difference at 70.
He also had a sizeable pension CETV which I am getting an actuary to value.
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