Initiative on Women and Retirement at Divorce

Here at the Pension Rights Center, we hear from thousands of people every year who have questions about their retirement benefits

One of topics we get asked about the most is dividing retirement benefits at divorce. The vast majority of individuals who reach out to us for this type of help are older women going through divorce.

The fact is, the process for getting retirement benefits at divorce can be complex and baffling

In some cases, the retirement benefit simply wasn’t addressed at the time of divorce, because retirement seemed far away and was not made a priority. Sometimes we learn that the benefit-earning spouse had failed to properly disclose the existence of some or all retirement assets. Or maybe the spouse’s lawyer just didn’t know to even ask about the retirement benefits. In far too many cases, these women are not receiving what they were legally awarded by their divorce decrees because federal law requires them to go through additional, difficult-to-navigate steps to obtain the benefits they were awarded at divorce.

Launching the Initiative

We launched the Initiative to ensure that women and other spouses going through a divorce know what they need to do to get benefits they were awarded in the divorce decree, and to make the process easier for everyone. We have brought together stakeholders from all sides – retiree organizations, women’s groups, pension plans, employers, financial institutions, family attorneys and judges – to develop recommendations for making the process easier for consumers and less burdensome for retirement plans.

Why a Women’s Initiative on Retirement and Divorce?

  • Divorced women over 65 are significantly more likely to live in poverty than their married counterparts.
  • The rate of divorce among older Americans has increased over time and continues to do so.
  • Economic coercion and dependency are major reasons that women don’t leave abusive relationships.

 

  • For low- and moderate-income divorcing couples retirement benefits are often the largest asset in the marriage.
  • At least 15% of the nearly 2,000 people who contact the Pension Rights Center each year have a question about accessing retirement benefits at divorce.

Why do Women Struggle to Obtain Retirement Benefits at Divorce?

In order for a spouse to receive a portion of their spouse’s benefits after a divorce, the divorce settlement has to divide the benefits. Then, they typically need another court order for each plan being divided, called a qualified domestic relations order (QDRO), which must be signed by a judge, and accepted and approved by the retirement plan. Many women are unable to access benefits awarded to them by a divorce decree because they do not know to obtain a QDRO, cannot obtain one, obtain an order that is not accepted by the plan, or are unable to navigate the procedures for submitting the order to a retirement plan.

What are the objectives of the Initiative?

The objective of the Initiative is to help economically vulnerable women obtain the retirement benefits that they have been granted in their divorce decrees. Anticipated outcomes are:

  • Increased public awareness of the need for QDROs to access benefits.
  • Increased access to QDROs, especially for low-income women and survivors of abuse.
  • Reduced difficulties and costs associated with filing QDROs.

What does the Initiative do?

The Initiative works, in partnership with impacted stakeholders, to overcome common obstacles confronting women seeking to obtain the retirement benefits awarded to them in family court.

In Phase One of the Initiative we:

  • Held a series of roundtable discussions with representatives of stakeholder communities, including employers, plans and-third party services providers; women’s groups and advocates assisting survivors of domestic violence; and family law attorneys and judges.
  • Produced a report outlining the obstacles and possible solutions identified during the roundtables.
  • Organized a Strategic Convening to bring together the various stakeholder communities involved in the roundtables to discuss the report’s findings and seek a consensus on possible solutions.

Now in Phase Two, we have:

  • Organized two task forces to develop and implement solutions identified during the conference.
    • Task Force I is focusing on public education about the importance of addressing retirement benefits for women and others facing a divorce, so they know what to do.
    • Task Force II is working to improve impacted individuals’ access to affordable, well-drafted QDROs by developing and expanding accessibility to well-drafted QDROS and provide trainings for legal experts, particularly focused on legal service attorneys.

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