Does it matter: QDRO before in pay status or after

[Guest dring]

Is there an actuarial difference, or a sacrifice of flexibility, if someone starts collecting a pension early, when it's still up in the air whether the marriage will last and whether there will be a QDRO, vs. waiting to start the pension only after knowing for sure whether or not there will be a divorce and QDRO?

If there is an actuarial difference or sacrifice in flexibility, would that equally affect the participant and the potential alternate payee? Or would the difference tend to favor one party over the other?

Thanks in advance for any insight.

[QDROphile]

Form of benefit is an issue. If benefits have started, they will have started in some form, such as a joint and survivior annuity. The QDRO can divide the payments, but cannot reform the benefit unless the plan allows and most plans will not. If the QDRO divides the benefit before payments start, then the QDRO can divide the value and most plans will allow each person to have an annuity form of benefit.

[david rigby]

Form of benefit is an issue.

Might be THE issue.

Another thought, actuarially, is what early retirement subsidy, if any, is included in the plan.

[Guest dring]

Thanks to both QDROphile and David Rigby for responding (although I see now I posted this in the wrong message board, should have been in the QDRO category).

So it sounds like maximum flexibility would come from QDRO before payout begins, all other things being equal. Thanks again to you both.

- Dring

[K2retire]

Maximum flexibility for the participant, or the alternate payee?