Often parties do not address the division of retirement benefits until after they are divorced. This can cause a lot of problems as explained in our blog “Not close to retirement age, why get a QDRO?”
You should start thinking about dividing retirement assets at the beginning of the divorce process. Retirement accounts gain value over time and can be a substantial asset in the negotiation process. Although it rarely happens, the best time to deal with all QDROs in your divorce is at the same time your divorce judgment is filed with the court. Your QDRO can be filed at the same time or soon thereafter.
Taking a hard look at all the retirement benefits between the parties truly helps protect both parties. Correct retirement plan information will be needed for your financial disclosures documents. You will need the best contact information for each retirement plan in order to notify the plan to place a hold on any payment from the account using tools like joinder pleadings (California only), or a notice of adverse interest. You may want to equalize and offset retirement accounts against each but then the accounts need to be valued properly. If there are any issues with the valuations which happens, this should be resolved before divorce! Your divorce or legal separation judgment will dictate how retirement benefits should be divided in a QDRO, so it is a good idea to understand how each account should be divided.