Three Actions to Set Yourself Up for Success Before a QDRO is Even Done

1. Obtain some basic information on the retirement benefits in your case

Most people feel overwhelmed by divorce in general but become even more stressed about gathering information on the retirement accounts to divide in the divorce. The good news is that in most cases the following minimal information is all you need for the QDRO(s) and to make sure you are not missing any retirement accounts:

• Both parties’ mailing address, dates of birth and in most cases social security numbers.
• The date of marriage and the date of marital division date based on your state's law (e.g., Date of Separation in CA, Date of Divorce in NV), court order or the parties' agreement.
• List of all employers where both parties worked during the marriage. If you know the employer, we can usually find the possible plan(s) to make sure you don’t miss any. Most mid-to-large private and public employers have both a plan with a monthly benefit payment at retirement (called a defined benefit plan) and a 401(k) or other similar type of plan (called a defined contribution plan).
• Find out if the participant is retired and receiving a benefit. This helps determine how the QDRO should be drafted and whether a survivor benefit exists. Even if you are not able to obtain this information, we can still draft a QDRO based on your best guess of whether the participant is retired and receiving benefits, and in most cases the retirement plan will let you know if the participant is not retired yet.

Two reasons to obtain this information are to make sure that (1) you can protect retirements accounts from withdrawals until the QDRO is done and (2) you have the correct divorce judgment language dividing the retirement accounts.

Once the basic information is provided, we can help you protect the retirement accounts and also make sure your divorce judgment regarding retirement benefits is done correctly.

2. Make sure retirement benefits are protected from withdrawals during the divorce

We get asked a lot “how can I make sure my ex doesn’t hurt my ability to receive my share of the retirement benefits before a QDRO is done?”

There are two legal measures you can take to make sure to protect your share which should be done when the divorce process begins, – Notice of Adverse Interest (NAI) and Joinder Pleading (Joinders). Joinders are only applicable in California.

These legal tools in most cases temporarily freeze the retirement account, preventing your ex-spouse from making changes that could affect your share. They're vital for keeping the funds intact until a Qualified Domestic Relations Order (QDRO) is formally issued.

For instance, without an NAI or Joinder, a divorcing participant might retire or remarry and start to draw benefits which may then stop the flow of benefits to the ex-spouse when the participant dies. Or the participant might withdraw funds or take out loans against them. These actions, which we see all the time, jeopardize the ex-spouse's ability to claim their share, forcing them potentially to pursue legal action against the participant—a costly and uncertain process.

What’s the difference between NAIs and Joinders in California? Joinders, required for all California public plans and some private ones, must be officially filed in court and thus take longer to effectuate a hold compared to an NAIs. However, both methods aim to safeguard an ex-spouse's interests by preventing premature fund distributions.

Despite the protections offered by NAIs and Joinders, most people don’t know about these protective simple steps which can make a world of difference for the ex-spouse.