Planning for Retirement After Divorce? Consider a QDRO

Illinois divorce attorney, Illinois family lawyer,Getting a divorce turns your entire life upside down. The asset division process can prove to be especially cumbersome for some couples, as it requires you to take every single asset and debt into consideration when making decisions. Most couples argue over the house, bank accounts, and vehicles. While these high-value assets are important, it is also important not to overlook one of your most important assets — retirement funds. It is easy to forget about retirement when it is 15 or 20 years away, but planning for it now can save you a big headache in the future.

When it comes to retirement plans, one of the most important tools in your toolbox is a QDRO, which is a commonly used acronym for a qualified domestic relations order. QDRO’s can be extremely beneficial when divvying up retirement plans during a divorce and can take some of the uncertainty out of your future.

What Is a QDRO?

In the state of Illinois, all pension benefits, including individual retirement accounts (IRA’s) and defined contribution plans and accounts, are presumed to be marital property and must be divided in “just proportions.” This is where a QDRO comes in. A QDRO is a legal document that designates an alternate payee’s right to receive all or a portion of the benefits held in certain types of retirement accounts.

What Is Included in a QDRO?

QDRO’s are just as legally enforceable as an order for alimony or child support and must be approved by the court. Basically, a QDRO will allow both payees to draw from the retirement plan when the time comes. Most of the time, the named payees will be both spouses, but in certain situations, the alternate payee can be a child or another dependant. For a QDRO to be valid, it must contain:

  • The plan owner’s name and mailing address;
  • The alternate payee’s name and mailing address;
  • The percentage of the plan that will be going to the alternate payee;
  • How that percentage will be determined;
  • The number of payments included in the order; and
  • How those payments will be made to each payee.

Consult with a DuPage County Asset Division Attorney Today

If you are getting a divorce, it is important that you keep all of your assets in consideration — including your retirement plan. By hiring a knowledgeable Aurora, IL asset division lawyer, you can be sure that you are getting your fair share of the retirement plan. Contact the Law Office of Matthew M. Williams, P.C. today to discuss your case and determine your best course of action. Call our office at 630-409-8184 to set up a consultation.

 

Sources:

https://www.thebalance.com/what-s-a-qdro-2894206

http://www.ilga.gov/legislation/ilcs/ilcs5.asp?ActID=2086&ChapterID=59

https://www.investopedia.com/personal-finance/whats-qdro/

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