If your spouse has a pension that they’re not yet receiving — simply because they are still working — it’s all too easy to forget about it when you’re going to get divorced. You look at the assets you see frequently and consider investments and other accounts that you helped set up. Plus, since your spouse isn’t drawing that pension yet, you may even figure you don’t have any right to it.
Not so fast. You very well may be able to get a portion of that pension, and you may find that it’s one of the most valuable assets you own.
A QDRO is absolutely necessary when dividing pensions in divorce
To divide a pension, you use a QDRO (Qualified Domestic Relations Order). Generally, a pension is considered an asset that was earned during the marriage. It doesn’t matter that you’re not getting payments yet; your spouse still has that account and has been earning it at work.
Dividing a pension looks different in different cases, but it usually means calculating what was earned while you were married and taking out what was not. For instance, imagine that your spouse’s pension is worth a total of $500,000. If $250,000 was earned in that pension prior to the marriage and $250,000 was earned after your marriage began, you would likely be due 50% of the $250,000 that was earned during the marriage, or $125,000.
This is just one example of how the division of a pension may work, of course, and the process is usually a bit more complicated.
Get help to make sure that your marital assets are correctly divided
Understanding the full extent of your rights in a divorce are important, especially when it comes time to divide the marital assets. An experienced advocate can help you learn more.