Oct 5, 2013 | Divorce


Retirement benefits earned during a marriage are generally marital property in Illinois. Being marital property means your retirement benefits are subject to equitable division during a divorce.

The first step in the division of retirement benefits is determining what kind of retirement benefit you have. The two main types are Defined Contribution Plans and Defined Benefit Plans. Defined Contribution Plans are plans where both you and your employer make contributions to the plan over time. An example would be a 401k. Defined Benefit Plans on the other hand are not dependent on contributions paid in. Rather Defined Benefit Plans are usually tied to the number of years you worked for a company. Pension plans are an example of this.

Once it is determined what type of retirement benefit you have, the current value of that plan must be determined. In some cases determining, the value is one of the most complicated steps.

After determining the value, the final step is dividing the retirement benefits. Due to the fact that most retirement benefits are not paid out until some later date, it is not as simple as writing a check to your soon-to-be ex. There are generally two options.

The first option is known as an offsetting award. With this option you would give your soon to be ex some other marital property worth the ex’s share of your retirement benefit and then keep the full value of the retirement benefit for yourself. While this is the simpler of the two options, this option is generally not an option for most divorcing couples. Most divorcing couples do not have other marital property worth as much as their retirement benefits.

The other option is a Qualified Domestic Relations Order (QDRO). A QDRO is an order of the court giving each spouse a right to a specific percentage of the retirement benefit at some later date. Usually this means your soon-to-be ex has to wait until you retire to collect their share of your retirement benefits.

For more information on dividing marital property, please feel free to contact The Law Office of Bradley R. Tengler in Rockford, IL at 815-981-4859 for a free consultation. Please note, the above does not constitute legal advice. Please discuss your specific rights with an attorney in your own jurisdiction.