Pension Rights After Divorce
A pension earned during marriage is generally considered to be a joint asset of both husband and wife. However, it is up to state divorce courts to decide whether and how pension assets are divided, and whether survivors benefits are payable. Except in the case of Social Security and Tier I Railroad Retirement benefits, a court order is necessary for someone who has been divorced to get a share of a pension.
If a pension is divided between divorcing spouses, it must generally be done at the time of divorce when other marital assets are divided. The court order or court approved property settlement that provides for a pension plan to make payments to a former spouse is called a domestic relations order.
Most retirement plans will pay pension benefits directly to divorced spouses if the domestic relations order meets certain requirements. In the case of private retirement plans, a domestic relations order (DRO) that meets these requirements is called a "Qualified Domestic Relations Order" or "QDRO." In most cases, payments can be made for the life of the employee or retiree, and also after death (whether it occurs before or after retirement). Some state, city, county, and town retirement plans will not make direct payments to former spouses. See State Retirement Systems and Divorce.
The rules relating to the division of pensions at divorce are complicated and vary from state to state and retirement system to retirement system. In addition, rights vary depending on when a divorce occurred. Many women (and men) were divorced when pensions were not considered to be marital assets, or before retirement plan rules changed to permit direct payment to former spouses.
For more information, check out a Pension Rights Center blog series on divorce and retirement assets:
- Getting divorced? Don’t forget the pension!
- A pension earned during a marriage is usually the property of both spouses
- Don’t delay: Submit court orders to the plan right away!
- Don't take a pension for granted
- Retirement and Divorce: Additional Resources
- The National Pension Lawyers Network is a free lawyer referral service that may be able to find a lawyer to help you.
- 7 Key Questions You Need To Ask BEFORE Your Divorce Is Finalized by WISER.
- The Division of Retirement Benefits Through Qualified Domestic Relations Orders , a publication of the U.S. Department of Labor's Employee Benefits Security Administration.
- Learn how the Pension Protection Act of 2006 changed the law relating to pension rights after divorce under the Railroad Retirement System and private retirement plans.
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PensionHelp America connects people who need help with their pension, 401(k), and other retirement plans with the pension counseling projects, legal services providers, and government agencies that can help answer their questions. Visit www.pensionhelp.org.
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Did You Know?
In 2011, workers can contribute up to $16,500 to their 401(k) plans. Workers age 50 and older can contribute $22,000. Employers can match those contributions up to a total employer-employee limit of $49,000. Check out our helpful fact sheet to learn the contribution limits for other retirement plans. Read the fact sheet.