Avoid the QDRO Trap!
Secure Your Hard Won Retirement Benefits Today!
Pensions, 401(k)s and other qualified retirement plans are often the most significant marital asset in divorce cases. It is vital that the QDRO be properly drafted to protect the respective rights of the parties.
What is a QDRO? A Qualified Domestic Relations Order (QDRO) is a legal document that directs the administrator of a pension plan to give a certain amount of an employee's pension to his/her non-employee ex-spouse after the divorce is final.
As a licensed Colorado attorney with over 15 years of QDRO experience, I am uniquely qualified to prepare QDROs for divorcing spouses. I have the legal knowledge, skill, and experience to draft an effective QDRO. In addition, I have the financial planning expertise to navigate the maze and complexity of the field of retirement plans.
QDROs are complex legal documents. A small mistake in the language used in the QDRO could cost you thousands of dollars in lost benefit payments. Be wary of "model" QDROs that plan administrators provide—they are often designed to benefit the plan and the participant spouse.
It is very important that the QDRO drafting process be initiated and completed as soon as possible in the divorce process, since a delay in getting the QDRO filed and accepted by the plan administrator could result in a loss of benefits by the non-participant spouse if the participant spouse dies, retires, quits, is terminated, etc. prior to the implementation of the QDRO.
I work with divorce attorneys, mediators, and pro se individuals in need of assistance with the QDRO process. My goal is to provide my clients with efficient, affordable and dependable QDRO drafting services so that they receive the money they deserve.
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A Too Frequent Scenario:
Husband and wife enter into a divorce settlement agreement and a Divorce Decree is entered by the Court. The settlement agreement and Divorce Decree state, "All retirement assets will be equally divided between the parties." Husband and wife are relieved that the divorce proceedings are finally over.
Several months later, the parties jointly retain a QDRO expert to draft the documents dividing up the retirement plans. Problem: His pension is a non-qualified plan and can't be divided. Her 401(k) has dropped in value by $65,000 -- what was the official division date? The divorce decree doesn't say. Are supplements, temporary benefits, and cost-of-living adjustments on both parties' pensions to be included or excluded? The divorce decree doesn't say.
Sadly, this is an all-too-common situation, because there is much confusion in the legal community regarding pension and retirement plans in general and QDROs in particular. QDROs have only been in existence since 1984. Exposure to increased liability has increased steadily among divorce attorneys as a result.
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