Divorce and the DB

[Guest m.n.ouellette]

My husband was married and worked for the State of NY, where he was a participant in their DB plan. He and wife #1 divorced, and she "gets" 1/2 of the value of his plan for the time they were married, 15 years. My husband (I'm wife #2) says that he and his ex-wife will each get checks starting when he turns 62 (or whatever the age is). Well that's 20 years from now!

I am a DC administrator, so I am putting this out there to DB experts: Can my husband and his ex-wife not "cash out" (??), or get distributed from, that plan now? What if she dies, or worse, if he dies between now and then?

He would like to be totally separate from her now, and not get statements knowing that 1/2 will go to her in 20 years. I know that DB plans are totally different animals than what I administer, so I am asking with very VERY little knowledge of your world...

Thanks!!

[QDROphile]

Different plans have different ways of dividing pension benefits. Nothing against your husband, but he may not be describing the situation with the precision that you are able to understand becuase of your related experience. Start with a copy of the order and any correspondence from the plan. It is also likely that the rules and procedures for division of benefits is in published regulations or adminstrative rules. Many govenment plans and the governing documents are unecessarily complex and difficult to understand, so good luck. Maybe you will get a more focused response from someone with experience with the plan.

[J Simmons]

A plan need not give an employee (or ex-spouse) a lump sum, 'cash out' option. In a DB plan, the only required distribution modes are qualified preretirement, joint and survivor and optional annuities.

QDROphile is certainly correct in that you need to get the documents he has specified. Whether the plan in question gives a lump sum option would be in the plan documents. What happens when your husband dies and what happens when his ex-wife dies depends heavily on the plan documents and the order (and correspondence). As importantly for you as these two questions, what happens if the ex-wife is yet alive when your husband begins to receive benefits under the plan.

If there is a misunderstanding by your husband and the ex-wife in what will happen under the plan in light of the order, they do have the opportunity to get the consequences under the current order sorted out with the plan administrator and if necessary, obtain a modified order from the divorce court. The sooner the better, particularly before one of them dies or the benefits go into pay status.

[Guest m.n.ouellette]

Thank you both for your responses. Amazingly, I feel 'over my head', after reading more posts about divorce. I think QDROphile is right, my husband doesn't speak this language, so to speak (HA another pun), and may be relaying the details a little warped. I will get the QDRO, if one, and the plan document(s). This may be a large undertaking, but well worth it in the long run.

Thanks again.