How Does Divorce Affect Your Pension Benefits?
There are many questions to ask when you are getting divorced and there are pension benefits to be distributed. For example, it is important to know if your spouse has more than one pension plan or other retirement plan from a current or previous job. How long has your spouse worked at this or a previous job? Is it long enough to earn a legal right to a pension? How much of these benefits have “accrued” in pension benefits? Do you need an actuary to value the benefits? Does a QDRO need to be prepared? And if so, does the order comply with the rules for that pension plan? Does the order specify what amount is to be paid to you? These are only some of the questions and issues to be answered and ironed out before you sign any settlement agreement. Furthermore, it is important to have a SURVIVOR’S BENEFIT in the Order so that if your spouse dies before you, that you still get a benefit – even if your spouse has remarried by the time of the demise.
Whatever you do, don’t overlook this important asset when negotiation a settlement with your spouse and his/her attorney.
One important caveat: what if your spouse reduces or eliminates your share of pension benefits? Is there anything you can do? This is important becuase there are times when a former spouse may get injured, or disabled. Or he or she may waive their right to the pension. So in the property settlement you want to make sure that you make allowances for that. You want to include language such that if your spouse in any way interferes with your right to benefits, he or she should pay maintenance, alimony or be required to give you property that he or she owns. Each case is unique in this regard.