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Financial Issues This forum is for discussing any of the financial issues involved in your divorce.

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  #1 (permalink)  
Old 11-17-2017, 12:04 PM
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Question Military Pensions

Currently wading through the tail end of a messy divorce. Military member with 26 years served, still serving.

Divorce agreement is being written up and ex-spouse's lawyer insists that my military pension shall be split 50% since inception even though we did not marry or live together until 4 years after I joined. Why should she benefit from the 4 years we were not together ?

My lawyer is telling me that it is considered the same as a house...if I owned a house for 4 years before I married and then we were together for 20 years and divorced, the house is now 50% hers.

Any advice in here from those already through the mill?

~Harry
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Old 11-17-2017, 02:05 PM
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I have no firsthand experience on this, but it seems seems weird that your lawyer is agreeing with her lawyer on this. I would ask your lawyer why a pension under the CFSA is treated any different than a pension under CPP?

Quote:
The Canada Pension Plan (CPP) contributions you and your spouse or common-law partner made during the time you lived together can be equally divided after a divorce or separation. This is called credit splitting.

sourced from https://www.canada.ca/en/services/be...t-credits.html
Or for another bit of related reading...Though it doesn't copy and paste without errors, so may be better to read at its source, provided at the end. Bolded italic lines below are from me.


Quote:
Division
  • 8 (1) A division of pension benefits shall be effected by
    • (a) subject to subsection (4), transferring an amount representing fifty per cent of the value of the pension benefits that have accrued to the member of the pension plan during the period subject to division, as determined in accordance with the regulations, to the spouse, former spouse or former common-law partner, if that pension plan is a retirement compensation arrangement, or, in any other case, to
      • (i) a pension plan selected by the spouse, former spouse or former common-law partner that is registered under the Income Tax Act, if that pension plan so permits,
      • (ii) a retirement savings plan or fund for the spouse, former spouse or former common-law partner that is of the prescribed kind, or
      • (iii) a financial institution authorized to sell immediate or deferred life annuities of the prescribed kind, for the purchase from that financial institution of such an annuity for the spouse, former spouse or former common-law partner; and
    • (b) adjusting, in accordance with the regulations, the pension benefits that have accrued to the member of the pension plan under that pension plan, notwithstanding the provisions of that pension plan or the Act under which it is established or by which it is provided.

  • Determination of period subject to division

    (2) For the purposes of subsection (1) but subject to subsection (3), the period subject to division is
    • (a) the period specified by the court order or agreement as the period during which the member of the pension plan and the spouse, former spouse or former common-law partner cohabited; or
    • (b) where the court order or agreement does not specify a period as described in paragraph (a), such period as may be determined by the Minister, on the basis of evidence submitted by either of the interested parties or by both, as being the period during which the member of the pension plan and the spouse, former spouse or former common-law partner cohabited.
Source - Pension Benefits Division Act
Pension Benefits Division Act
Bear in mind, that as stated, I have no first hand knowledge of this stuff, and just looked into it a bit as it seemed interesting. There's probably contradicting references or caselaw to what I just posted.
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Old 11-17-2017, 02:59 PM
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I think that lawyer is either terribly mistaken or lying, or you are confused about what exactly is being asked.

Pensions accrued DURING the marriage need to be divided.

The entire pension does need to be divulged during full financial disclosure. But only the part accrued during the marriage is actually shared.

Your pension administrator can easily provide you with the number to split, if you tell them the date of marriage and the date of separation.

Be wary of two things to do with Government of Canada pensions (at least if they work the same way for military as for civil servants):

If you don't divide the pension perfectly equally through the pension administrator, like say if you agree instead that your ex keeps the house and you keep the whole pension intact, then she can go back to the pension administrator any time din the future and say "hey, I got divorced back in 20XX and didn't get my proper share of his pension" and they will JUST GIVE IT TO HER. The only way to fight this is to have a separation agreement that shows how you did it instead, with the right number of the pension accounted for. 'W got $XXXk greater value in the house instead of receiving $XXXk from H's pension.'

If you die before the divorce is decreed, she still gets survivor benefits as your legal wife. Even if you have a new common-law spouse you have declared as a beneficiary, the pension administrator will give it out in proportion to how many years you were with each woman. Don't let the process drag out too long, especially if you may end up somewhere dangerous.
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Old 11-17-2017, 03:39 PM
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Quote:
Originally Posted by Rioe View Post
Be wary of two things to do with Government of Canada pensions (at least if they work the same way for military as for civil servants):

If you don't divide the pension perfectly equally through the pension administrator, like say if you agree instead that your ex keeps the house and you keep the whole pension intact, then she can go back to the pension administrator any time din the future and say "hey, I got divorced back in 20XX and didn't get my proper share of his pension" and they will JUST GIVE IT TO HER. The only way to fight this is to have a separation agreement that shows how you did it instead, with the right number of the pension accounted for. 'W got $XXXk greater value in the house instead of receiving $XXXk from H's pension.'

If you die before the divorce is decreed, she still gets survivor benefits as your legal wife. Even if you have a new common-law spouse you have declared as a beneficiary, the pension administrator will give it out in proportion to how many years you were with each woman. Don't let the process drag out too long, especially if you may end up somewhere dangerous.
They more than likely do work the same now, as back in July 2016 pension administration for the CAF was transferred to the GCPC (Gov't of Canada Pension Centre)
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Old 11-19-2017, 12:34 PM
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Are there any military members here with firsthand experience because I'm also curious about the split and how they administer it. I'm a military member and she is not. When she gets my 50% is she able to draw payments from it as soon as 'I' retire or does she need to wait til she retires ? I've read that her 50% will be placed into a locked in RRSP and can't be touched. I've also read that she could possibly convert it in to a LIRA and draw from that immediately.
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Old 11-19-2017, 12:36 PM
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I'm definitely going to investigate this further by calling Canada Pension.




Quote:
Originally Posted by Rioe View Post
I think that lawyer is either terribly mistaken or lying, or you are confused about what exactly is being asked.

Pensions accrued DURING the marriage need to be divided.

The entire pension does need to be divulged during full financial disclosure. But only the part accrued during the marriage is actually shared.

Your pension administrator can easily provide you with the number to split, if you tell them the date of marriage and the date of separation.

Be wary of two things to do with Government of Canada pensions (at least if they work the same way for military as for civil servants):

If you don't divide the pension perfectly equally through the pension administrator, like say if you agree instead that your ex keeps the house and you keep the whole pension intact, then she can go back to the pension administrator any time din the future and say "hey, I got divorced back in 20XX and didn't get my proper share of his pension" and they will JUST GIVE IT TO HER. The only way to fight this is to have a separation agreement that shows how you did it instead, with the right number of the pension accounted for. 'W got $XXXk greater value in the house instead of receiving $XXXk from H's pension.'

If you die before the divorce is decreed, she still gets survivor benefits as your legal wife. Even if you have a new common-law spouse you have declared as a beneficiary, the pension administrator will give it out in proportion to how many years you were with each woman. Don't let the process drag out too long, especially if you may end up somewhere dangerous.
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