What are the 2 types of retirement plans to look out for?

Both public and midsize to large private employers often provide their employees with 2 types of retirement accounts. The 2 categories of retirement plans are a defined benefit plan (most are set up to be a monthly payment over a lifetime) and a defined contribution plan (most are set up to be paid as a lump sum and most commonly known as a 401k). More detail on what is a defined benefit plans and what is a defined contribution plans are outlined in other blogs.


If an employer offers a defined benefit plan, in almost all cases all employees must be participants in that plan. Most private and public plans offer their employees defined contributions plans. However, defined contribution plans in most cases are voluntary plans so some employees may not be a participant in an employer’s defined contribution plan. Mid to large private and public employers likely have both a defined benefit plan and a defined contribution plan for their employees.


Very often the parties unknowingly only divide one of the two plans in a divorce. For example, the divorce judgment will award the marital or community property interest in one party’s 401k. But that party also has a traditional pension which will be paid monthly for a lifetime but at a later time. That is the million dollar asset and it is often missed!


In so many cases, the omitted plan is either because the participant does not know what plans they have or because the participant is hiding a retirement asset. We want to make sure that a retirement asset is not missed. QDROCounsel has a database of over 300,000 retirement plans. If it is not clear what retirement plans are in your case, QDROCounsel can try to figure that out for you so you don’t miss a plan. Missing plans is a big problem!

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