I have run into an issue regarding the valuation of my client's PERS pension - specifically which interest rate should be used to determine the present cash value of his NJ pension plan.
The statutory rate for the plan is 7.9%. The present cash value of the plan assuming 7.9% is significantly less than the valuation utilizing the 30 YTB rate of 3.33%. The difference in value and dispute over which interest rate assumption is appropriate has caused a major road block in an otherwise straightforward and resolvable matter. It's a game changer.
Has anyone else run into this? Is there any authority with regard to which interest rate assumption should be applied to a valuation of a PERS pension for equitable distribution?
I would hate to see this devolve into dueling experts.
Any input would be very much appreciated.
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Carolyn Hand Esq.
Denville NJ
(973)537-1700
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