State Retirement Plans and Divorce
Each state retirement system has its own rules relating to the division of state employees' pensions in divorce proceedings. Below is basic information on each state retirement system's rules.
Why does this matter?
A pension can be the most valuable asset of a marriage. When going through a divorce, both parties to the marriage should know whether the state government employee's pension or other retirement plan asset can be divided, whether survivors benefits can be paid to a widow or widower, and what information must be included in any state court Domestic Relations Order to ensure that the retirement system will make the court-ordered payments. The Pension Rights Center's book, Your Pension Rights at Divorce provides helpful information on spousal pension rights. Chapter 8 [PDF] contains information about rights at divorce under state retirement systems.
A DRO is a state domestic relations court order that allows for the division of assets in a divorce. Some states have special types of DROs for retirement plan assets. These are often called Qualified Domestic Relations Orders (QDROs). The DRO tells the retirement system how much the employee and ex-spouse are to be paid, when they are to be paid, and the form of payment. If a state retirement system does not permit the division of government employees' pensions at divorce, it may be possible for ex-spouses to receive other property, for example a house or liquid assets, of equal in value to the pension share and survivors beneifts.
If you want to know what a state’s retirement system rules are under divorce, click on the state in the map below for a link to the state plan. (11/4/2011)
Looking for help with your retirement plan?
If you have a problem with your retirement plan, free help may be available from the U.S. Administration on Aging's network of Pension Counseling and Information Projects. Find help now.
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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Retirement USA is a national initiative that is working for a new retirement system that, along with Social Security, will provide universal, secure, and adequate income for future retirees. Visit the website.
Did You Know?
A 401(k) plan is a retirement savings plan in which the benefit is based on contributions to an individual account and the investment return on those contributions. Typically, employees make contributions to the plan and, in many cases, employers match the employees' contributions. These plans are called defined contribution plans. In most 401(k) and other retirement savings plans, the employee is responsible for choosing among the investments offered by the plan. Other types of retirement savings plans are 403(b) and 457 plans.