Can I Keep My Pension After Divorce?

Marriage is a commitment born out of love, but it is also an economic contract. Long after the romance has fizzled out, real concerns about how to divide the assets couples have acquired during the marriage remain; one of these assets being a pension. While a pension earned by one spouse is considered joint marital property, state laws vary regarding how these assets are divided.

In New Jersey, retirement funds are subject to equitable distribution, pending the execution of a Qualified Domestic Relations Order (QDRO). A QDRO is an essential part of the process of dividing retirement monies accrued during the marital coverture period equally between spouses. Without a QDRO, a pension plan administrator is not required or obligated to segregate this asset.

Protecting Your Pension
Because retirement funds are considered part of your marital assets, they are subject to equitable distribution under the law. However, your former spouse needs to complete the required process to obtain half of your pension. First, they need to ask for a share of your pension at the time of the divorce, and alimony negotiations, not after you have retired.

Next, they need to obtain a QDRO and send a copy to the pension plan administrator immediately. The QDRO contains all the important information about who, when, and how much to pay out. The QDRO also prevents the plan from paying your former spouse in ways the plan does not permit, such as in a lump-sum, for example.

In most cases, payments are made for the life of the employee and even after their death. For your former spouse to receive a survivor’s pension benefits, they must specifically request it. This directive must be separately included in the property settlement or divorce decree. Because every pension plan is different, your ex-spouse needs to comply with the procedures established in your plan.

Certain couples agree to allow the spouse with the pension to retain all their retirement funds in exchange for another asset of significant value. This is something your Burlington County alimony lawyer can help determine if it makes fiscal sense for you.

Determining the Marital Coverture Period
In New Jersey, if your former spouse completes the required process, they are most likely entitled to half of your retirement assets acquired during the marital coverture period, or from the date of the marriage and when you started funding your pension. The date the Complaint for Divorce is filed in the Superior Court of New Jersey is considered the cut-off date. Anything earned past that point is your sole property as is anything contributed prior to the date of the marriage.

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Philip Smith Burnham II

Licensed since 1990

Member at firm Burnham Law Group, LLC

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