Pension Case Study and Divorce
Case Study: Jones vs. Jones
The Present Value of Mr. Jones' Defined Pension Benefit as determined by the PBGC Actuarial and Mortality Tables Method is $63,320.04. This calculation was derived from the following facts and assumptions:
Facts Given to the Pension Appraiser:
Facts Governed by the Pension Plan:
Assumptions and Facts Determined by the Pension Appraiser:
What effect could we have on the Present Value of Mr. Jones' Pension Benefit if we changed certain assumptions or facts?
If Mr. Jones started receiving benefits at age 60 instead of 62, and all other facts and assumptions remained the same, including the monthly benefit of $842.14, what would be the present value of his benefit?
If the Interest Rate Assumption was 5.30% and 4.75% instead of 5.80% and 4.75%, and all other facts and assumptions remained the same, what would be the present value of his benefit?
If the Jones' were married on March 1, 1965 instead of April 30, 1970, and all other facts and assumptions remained the same, would the present value of his plan change for Equitable Distribution purposes?
If the monthly vested benefit were $1,200 instead of $842.14, and all other facts and assumptions remained the same, what would be the present value of his benefit?
If he is expected to live longer, will the present value of his benefit increase?
If the Date of Valuation changed to October 1, 1996, would the present value of the benefit change?
If the monthly benefit increases to $900, and the interest rate increases to 6.00%, what would happen to the present value of the benefit?
If Mr. Jones starts receiving benefits at age 58 instead of 62, and his monthly benefit is reduced in half to $600.00, what would happen to the present value of the benefit?
Resources & Tools
GOOD LEGAL ADIVCE -- The division and distribution of pensions often becomes very complicated, and these issues probably generate more appeals and reversals on appeal than any other issue in equitable distribution. Woman must learn how to ask the right questions when facing the distribution of pensions and retirement plans.
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Online Pension Valuations
PensionAppraisalDeskTM uses a mathematical, web-based calculation software that gives family law attorneys, their clients, and pro se filers an instant, easy, accurate appraisal of the present value of pension benefits for equitable distribution upon divorce.
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