Helping low and modest-income clients of nonprofit legal aid programs secure their retirement benefits in divorce can enormously affect their monthly income, asset accumulation, and future financial security. Pensions are often the only asset for low and moderate clients in family court. In addition to increasing a client’s income and/or assets, pensions can also be used to pay arrears in child and spousal support and for equalization payments.
Leaving pensions undivided in a divorce, particularly in a long-term marriage, is harmful to the economic well-being of clients served by nonprofit legal aid programs. Enrolling in this one-year free program underwritten by the California Access to Justice Commission will provide legal aid staff with the tools and knowledge to divide pensions for their clients and build institutional capacity to continue the assistance after the project ends.
A common misconception is that individuals need to wait until retirement or the completion of the divorce to claim their marital interests. A delay can lead to loss of benefits due to withdrawal of funds by, or death of, the primary holder of the pension called the “participant.”
The best practice is for a Qualified Domestic Relations Order (QDRO) to be prepared while the parties are working on their judgment or marital settlement agreement.
Pensions are an increasingly commonplace employment benefit in the workplace. The vast majority of employers, including those associated with minimum wage employees, have defined contribution plans. Some California examples include Burger King, Smart & Final, Walmart, and Lowes, to name a few. In California, a new law mandates that employers with five or more employees offer retirement accounts.
The solution to help these clients is now possible for nonprofit legal aid programs. By participating in the Dividing Pensions in Divorce Project, legal aid staff will receive expert live (video) training, QDROCounsel’s proprietary software, pre-recorded webinars, mentoring, and help desk support. This will enable nonprofit legal aid programs to build in-house capacity to assist clients with pensions in their divorce cases now and in future years.
What does participation entail?
By agreeing to participate, nonprofit legal aid programs commit to attending CLE-certified trainings, which will be live video sessions and also recorded for later review. The comprehensive training is intended to achieve the following learning objectives:
During the live training, enrollees will be introduced to QDRO Counsel’s proprietary pension division software and taught how to use it. Participating nonprofit legal aid programs and court-based self-help centers will be provided the software for free. The QC software revolutionizes the pension division process by automating every step with a deep database of pension plans and built-in calculators to compute marital interests as well as language for creation of QDROs and judgment language. In addition to the software, following completion of the live training, participants will be entitled to free pre-recorded webinars, QDROCounsel help desk support, and review of any of the recorded training segments.