survivor benefits, QDRO and remarried

[Guest CliffG]

I have a question regarding survivor benefits for my pension plan.

First, some information. I am the participant and there is a QDRO from a previous marriage applied to my pension. The pension is a defined benefit and the QDRO is a shared interest. The AP gets a defined % ((marriage time / work time) * .5 * pension) and her payments start when mine do. There is specific wording regarding the P predeceasing the AP:

"Should the P predecease the AP, the AP shall be designated as the surviving spouse for purposes of both the pre and post-retirement survivor annuity benefits. The AP's portion of both the pre and post-retirement survivor annuity shall be computed as described [in formula]."

There is no specific wording in the QDRO regarding the AP predeceasing the P. If this occurs, is it normal for the AP's benefits revert back to the P (me)? I have a call into the QDRO/pension administrator and I did not find anything in the plan description regarding this.

Also, since I am remarried, my current spouse will get nothing if I die before the AP or I start drawing my pension while the AP is still alive - correct? If the AP dies before I start drawing my pension will my current spouse now be eligible for the survivor benefits? I would assume so, since the QDRO is void in this situation?

It would seem that it may be better, if the AP is still living at the time of retirement, to take a lump sum distribution and let the AP take her share and then the rest becomes part of my current estate. Thoughts on this?

Thanks in advance for any help,

CliffG

[QDROphile]

General conceptual answers:

It appears that the alternate payee is awarded a portion, less than 100 percent, of your benefits, including survivor benefits. The remainder is yours and would be the basis for any survivor beneifts for your surviving spouse, no matter when you die. When you die will determine which survivor benefit applies. I am skeptical of your use of the term "shared interest" unless there are more relevant terms than you have reported.

Most plans provide that if the alternate payee dies before starting benefits, the participant's benefit is restored as if no QDRO.

The answers specific to your situation depend on tems of the plan, the plan's QDRO procedures, the order, and any interpretation of the order by the plan administrator in connection with the determination of qualification. Also, the plan administrator should be able to answer your specific questions. Someone should have considered the questions and advised you when the order was drafted so your agreement to the terms would be adequately informed.

[Guest CliffG]

Yes, you are correct the AP is awarded a portion (7.5/19 x 50% = approx 20%) and my pension was capped in 2003 so the portion is fixed. I'm not sure about the "shared interest" term either. There is no separate account and my pension amount can change, based on earnings, market, etc. The benefits are paid over my lifetime, when I elect to start taking them and the AP is entitled to ad hoc increases should they be granted.

The QDRO was done in 1994 by my atty and it appears to be a model form, sent from my company and revised. I do not even remember discussing it. I just started looking into it as retirement is looking more like an option. I fault my atty here, she was not looking out for my best interests or was in a rush, IMHO.