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

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Old 05-27-2011, 02:12 PM
berniez berniez is offline
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Default Pension - Forced to payout in cash ??

Hello,
Things were going in court OK until I get hit with this one. After selling our home we will have each about 70K - fine no problem. Next my pension gets evaluated with her entitled share being about 127K to which my employer has already made arrangements to be set aside into a separate RRSP, annuity, etc. plan. Now she wants this as cash instead and I am being told by both lawyers that I must buy this out on a cash basis ?? Even though there is not enough money on my side to do this?? I am already paying CS and SS totalling 20K on a gross salary of 86K with NO SAVINGS LEFT - surprise!! She spent it all without me knowing. I really need that 70K just like she needs hers to start my life over again. She earns 22K.

I pushed this to a trial against the advice of my lawyer. Completely unfair in my opinion as I feel that there already is a fair division of all assets. My company WILL NOT allow me to cash in the pension as I had hoped.

Any thoughts?? (HELP)
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Old 05-27-2011, 02:51 PM
dinkyface dinkyface is offline
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No idea if this would fly, but anyways...

Will the company permit you to cash in part of the pension, if you agree to receive a reduced amount or pay a penalty?

Then you could argue that can offer the cash, but only a reduced amount.
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Old 05-27-2011, 02:58 PM
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billm billm is offline
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I agree with you, there should be no onus on you to convert it to cash, especially considering that it can't be done directly.

Also while you were married, the plan was to use that money for retirement. There is no valid reason that she can now force you to give it to her for its cash value. It is as much hers as it is yours, and she gets half of it in its present state.

Your ex is a ....
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Old 05-27-2011, 03:17 PM
winterwolf7 winterwolf7 is offline
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It's one of those days I'm almost grateful that I've always been too poor to save a nickle towards retirement, pensions or RRSPs.

Maybe check out this link?

Dividing your pension (Seperation or Divorce):
Dividing your Pension (Separation or Divorce)

Looks potentially helpful.
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Old 05-27-2011, 03:30 PM
berniez berniez is offline
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Quote:
Originally Posted by dinkyface View Post
No idea if this would fly, but anyways...

Will the company permit you to cash in part of the pension, if you agree to receive a reduced amount or pay a penalty?

Then you could argue that can offer the cash, but only a reduced amount.
There is no way of doing that. I'm perfectly happy with EVERYTHING being split equally and that means half a pension - no problem. The issue is being FORCED into buying that half out. Hopefully someone out there has had experience with this one.

Also just off the phone with the pension people (I work for a very large recognized Canadian company) who have never heard of this story before but not entirely sure of the Ontario laws either.
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Old 05-27-2011, 03:43 PM
Stressed by Ex Stressed by Ex is offline
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Check out this site...I'm going through the same thing. We shouldn't be forced to pay out a lump sum!

Your Pension Rights - Financial Services Commission of Ontario
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Old 05-27-2011, 03:44 PM
berniez berniez is offline
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Quote:
Originally Posted by winterwolf7 View Post
It's one of those days I'm almost grateful that I've always been too poor to save a nickle towards retirement, pensions or RRSPs.

Maybe check out this link?

Dividing your pension (Seperation or Divorce):
Dividing your Pension (Separation or Divorce)

Looks potentially helpful.
Hey thanks for that. It does not mention any cash buy out as I suspected, only a transfer to a locked in RRSP or life annuity. Score 1 point! BTW good luck and all the best with your own retirement
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Old 05-27-2011, 03:54 PM
berniez berniez is offline
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Quote:
Originally Posted by Stressed by Ex View Post
Check out this site...I'm going through the same thing. We shouldn't be forced to pay out a lump sum!

Your Pension Rights - Financial Services Commission of Ontario
OK just had a quick look and again nothing in there. What is your situation? I'm beginning to think this is more of a bluff than anything else which is why I am glad that I did not sign off and have forced this to a trial in mid June.
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Old 05-27-2011, 04:33 PM
winterwolf7 winterwolf7 is offline
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I think you're right. Yes she's entitled to her share of the pension, but if YOU have to wait until retirement to see that money, so does she.

Which reminds me, although I have never saved any money for retirement, I'm entitled to half of my exes Thanks for the reminder. More fuel for my fire too!
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Old 05-27-2011, 05:43 PM
berniez berniez is offline
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WW7

Go get her and good luck - whats fair is fair.

UPDATE: looks like anyone in this sitch falls under one of two categories. Federal pension law which is governed by the OSFI ??? (researching later) or Provincial pension law which falls under the Financial Services Commission of Ontario. That later commission publishes a .pdf which on page 28 of "Your Pension Rights", section "Pension Splitting on Marriage Breakdown", states that

"the former spouse of a pension plan member cannot gain access to a member's pension benefits until the member is entitled to receive benefits or reaches the normal retirement date".

I fall under the Federal statute of law which hopefully says the same thing. I know that federal government workers fall under the same provincial clause so I would expect that everyone is in the same picture so to speak. Could be a great weekend after all!!
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