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A QDRO helps you secure a share of spouse’s retirement assets

So many things are about to change with a pending divorce. And among the matters on that long list include retirement investments. In these instances, a qualified domestic relations order (QDRO) comes into play. This legal document represents a crucial part of a divorce agreement.

A QDRO authorizes a former spouse to secure half of the other spouse’s retirement assets accumulated during the marriage. Those funds may originate from 401(k)s, 403(b)s, 457 plans, pension plans, profit-sharing plans and employee stock ownership plans. This financial conundrum can surface in any marriage, but it remains significantly important for people going through a gray divorce where a greater amount of retirement assets are at stake. And understand that retirement assets from multiple retirement plans may be subject to a QDRO.

Guidance from a skilled attorney

The first step needed to launch a QDRO is to contact the retirement plan administrator. An organization representative will provide you with the necessary documents to complete the order.

However, in many cases, it is wise to work with a skilled attorney who can ensure that the QDRO is completed correctly. You do not want any mistakes made, so a knowledgeable attorney represents a good investment.

A solid and skillfully prepared QDRO addresses just how much money you will receive and also determines whether interest payments come into play. The latter scenario often surfaces because a divorce may not get finalized until weeks or months after the QDRO is completed.

Here is an example. Let us say that through the QDRO, you are set to receive $1 million from your spouse’s retirement investments. However, it takes another four months to complete the divorce. You will receive interest earned on that $1 million for those last four months.

Any asset accumulated during a marriage is marital property and subject to division between the two soon-to-be former spouses. Retirement investments often fall into this category. Remember, you deserve the assets that rightfully belong to you.


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