Pension Divorce Calculator

The “Pension Divorce Calculator” makes an estimate for a Pension Sharing Order.  We allow for discount rates, inflation rates, and gender-specific mortality rates including future mortality improvement.  Discount rates are used to compare aggregate future standard pension payments with the total cash-in value allowing for the time-value of money.  All these forecasting elements are based on research published daily by the Bank of England or the yearly Continuous Mortality Investigation of the Institute and Faculty of Actuaries.

Congruent has kept the options made available to users of the portal simple but behind-the-scenes Congruent has the facilities to adjust the pension starting age and a pension ratio between the two parties other than 50/50 – that is an optional additional, chargeable, service.

It is important to realise that the amount of the standard pension determined is unlikely to be achieved, even approximately, in practice.  When the applicable age is reached the amount of pension may be very different (even if one then excludes the pension earned subsequently).  This situation is a consequence of the “clean break” principle and the fact that discount rates and inflation rates are volatile – when the time is reached for the pensions to be payable the history of discount rates and inflation rates can be very different.  Also if either of the parties is many years from the age assumed for the pension to be payable the fact that mortality has been assumed is also a factor (but explaining that is too detailed to be set down here).