If you did a Google search to find me, you will no doubt have read a dozen or so other sites regarding the types of orders you need to properly divide retirement assets. The most common order is called a Qualified Domestic Relations Order (QDRO). Lawyers get caught up in the lingo, calling them “Quadros,” just throwing the word around like anyone should know what it means and so many clients and potential clients afraid to ask more detailed questions about it because it rolls off the tongue so easily that they think maybe everyone knows something about them, but Domestic Relations Orders (qualified or not) are actually a really complicated area of practice that almost no practicing trial lawyer truly understands. There are many different types of Domestic Relations Orders, but I do not want to get bogged down in this section trying to distinguish between all of them – I go into much more detail about QDROs and other types of orders in the FAQ on this site so you can read about the finer details without being overwhelmed at this stage.
In short, a Domestic Relations Order (a DRO) is an order made by a court to divide assets, in this case, a retirement asset. These orders must be very specific in their terms, so that the administrators who administer pension/retirement plans know exactly how to divide the assets, what to do in the case of a second marriage, and what to do if the plan member or spouse dies. Because a defined benefit plan of any sort does not have an exact value at the date of most Matrimonial Judgments (because the plan member will continue working or because there is no way to know how long they will live, etc.), we rely on actuarial tables that insurance companies use to determine the cost of insurance. Most of these plans are a type of annuity, the value of which depends on how long a person works and their age when they retire. If a 50-year-old woman with 25 years of contribution to her pension gets divorced, she may continue working another 15 years, or she may move to Italy to tend to an olive orchard. Since we don’t know this at the time of division, most DROs say something like “50% of the community property interest in the defined benefit plan.” This language, by the way, is not sufficient to draft a QDRO, but it might be sufficient for a DRO. Since most judges and lawyers think in terms of the “50% of” language, the people who draft the QDRO or other order have to be more specific in how they prepare the orders.
This site (and my service) is designed to help you get through the division of retirement assets without a lot of additional stress. Too often, you go through a divorce, the divorce decree or judgment says “divide the retirement assets equally,” and then nothing ever happens again. The Judge, in a contested divorce, may also sort of waive her hands dismissively and say “divide the pension equally (or by “the time rule”)”. At retirement, the ex-spouse looks at the decree and tries to figure out how to get the retirement assets into their name, only to find out that it is far too late in the process to do it correctly – worse, the interest in the pension may be lost when the ex-husband (or wife) dies unexpectedly before the QDRO can be entered and there is no “spousal benefit” protection plan in place.
If you are reading this now as you are in the middle of a divorce or just after your divorce has finalized (your lawyer saying: “I don’t do QDROs, hire an expert and they will take care of it”), you are ahead of the game.
