QDRO on pension

[mistoffolees]

How much is the present value of her potential pension? Even if vested at 4 years rather than 5, I suspect that any value of a marital share would be pretty negligible at this point. You would not be entitled to 1/2 of the full value of the pension at retirement, but only 1/2 of the present value and its growth.

Just to give you an example, I have many tax clients who have pensions from companies where they worked for only a few years after being vested, and many of them receive only tiny amounts of money a month...because the payout is over their expected lifespan.

You don't want to spend any significant time or legal bucks if any pension payout at retirement is going to be 35.00, monthly, for example.

Therefore I would be looking at the value of the pension account now, and if its only a few thousand, I wouldn't spend a great deal of time or money trying to divide it...because the future payout won't be worth it.

That's the point I'm trying to make - but didn't have any figures. What I do know is that pensions are typically back-end loaded with some kind of exponential curve. A 4 year pension is not likely to have a whole heck of a lot of value.

 

[Bali Hai]

How much is the present value of her potential pension? Even if vested at 4 years rather than 5, I suspect that any value of a marital share would be pretty negligible at this point. You would not be entitled to 1/2 of the full value of the pension at retirement, but only 1/2 of the present value and its growth.

Just to give you an example, I have many tax clients who have pensions from companies where they worked for only a few years after being vested, and many of them receive only tiny amounts of money a month...because the payout is over their expected lifespan.

You don't want to spend any significant time or legal bucks if any pension payout at retirement is going to be 35.00, monthly, for example.

Therefore I would be looking at the value of the pension account now, and if its only a few thousand, I wouldn't spend a great deal of time or money trying to divide it...because the future payout won't be worth it.

I agree, if the pension is presently worth $3k, he gets $1,500 credit in the property settlement. He gets $1,500 whether she stays working and gets vested or not.

 

[LdiJ]

I agree, if the pension is presently worth $3k, he gets $1,500 credit in the property settlement. He gets $1,500 whether she stays working and gets vested or not.

I don't agree with that Bali...because she may never get vested. Stuff happens in life. If she gets laid off due to the economy before she hits the 5 year mark, she won't ever be vested.

Although, that is a way to handle it if all the parties agree. Its just not necessarily an equitable one.

 

[Bali Hai]

I don't agree with that Bali...because she may never get vested. Stuff happens in life. If she gets laid off due to the economy before she hits the 5 year mark, she won't ever be vested.

Although, that is a way to handle it if all the parties agree. Its just not necessarily an equitable one.

Well, it will give her some incentive not to try anything cute.

A provision could be incoroprated into the decree that if she does not become vested at the 5 year mark, the court retains jurisdiction over the matter. She must bring the issue back before the judge to try to get the $1,500 back.

 

[tuffbrk]

Well, it will give her some incentive not to try anything cute.

A provision could be incoroprated into the decree that if she does not become vested at the 5 year mark, the court retains jurisdiction over the matter. She must bring the issue back before the judge to try to get the $1,500 back.

No, no, no! Family court is enough of a merry go round!! The attorneys make enough money already. If consumers had any recourse against their service providers, the merry go round ride would end. I sometimes think half the NJ court docket is filled with people simply trying to get their former attorneys mistakes and oversights corrected. (And that's no offense to OHgal).

 

[tuffbrk]

Uh oh! I went off topic/thread. My apologies...