Divorcing couples in Florida must divide their marital property in a way that is fair, unless a prenuptial agreement provides other instructions. Marital property includes any assets acquired during the marriage or that are jointly owned.
Retirement benefits are also included under this definition of the marital estate. However, an individual may have to specifically request a share of his or her spouse’s pension in order for it to be included in the divorce order. Said another way, pensions are not divided automatically during the divorce. For that reason, our family law firm recommends consulting with a divorce attorney that has experience in complex property division matters.
Special issues may arise regarding retirement benefits. For example, if a spouse has both a 401(k) plan and a traditional pension, the settlement order presented to the divorce court should specifically request benefits from each.
Steps may also be needed to protect your interest in your spouse’s retirement benefits. One strategy is to write to the pension plan administrator, informing him or her of the pending divorce. That letter will notify the administrator that the plan should not pay out the beneficiary’s share of benefits before the divorce order is finalized.
Retirement benefits also implicate a federal law called the Employee Retirement Income Security Act of 1974. ERISA provides that retirement benefits are intended only for the employee/retiree, with one important exception: qualified domestic relations orders. QDROs allow an individual to assign any portion of his or her retirement benefits to a spouse, child or dependent to satisfy a divorce obligation, such as alimony, child support or property division. In our next post, we take a closer look at QDROs.
Source: “QDROs: The Division of Retirement Benefits Through Qualified Domestic Relations Orders,” copyright 2014, U.S. Department of Labor