Will I get my ex’s pension when he dies?

Photo: pixabay.com

Q. I am divorced from a N.J. fireman and I was a state employee. We each got 50% of each other’s pensions. But for his pension, if he dies, the pension turns into a death benefit for the “present spouse” because of how the contract is written. We were married for 37 years. His present wife had nothing to do with the pension she’ll walk away with the death benefits, thus leaving me with nothing. Is there anything I can do?
— Ex-wife

A. We understand why you’re not happy with this arrangement.

While pensions and other retirement assets are routinely divided by way of Qualified Domestic Relations Order (QDRO) as part of equitable distribution in divorce, the language of those agreements and orders is crucial when it comes to survivor benefits, said Thomas Roberto, a family law attorney with Adinolfi, Lieberman, Burick, Falkenstein, Roberto & Molotsky in Haddonfield.

He said if the agreement or order does not specifically provide for the non-employee spouse to receive survivor benefits from the other’s pension, then the non-employee spouse’s interest in the pension will likely terminate upon the death of the employee-spouse, he said.

This is really a two-step process as the agreement or order is generally entered first, with the QDRO entered thereafter, Roberto said.

“The QDRO is ultimately what gets sent to the retirement plan administrator for implementation, so it’s essential that the QDRO appropriately address survivor benefits in detail where applicable,” he said. “The terms of the QDRO, however, are dictated by the language of the divorce agreement or court order.”

In other words, he said, survivor benefits generally cannot be addressed in a QDRO if they are not first addressed in the final agreement or order.

Both the divorce agreement/order and the QDRO should confirm whether or not one spouse is entitled to survivor benefits and, if so, the manner in which those benefits will be provided, Roberto said.

“This requires the inclusion of specific language in the agreement/order, as well as the QDRO, confirming the right to survivor benefits and the manner in which responsibility for the cost of such benefits, if any, will be apportioned between the parties,” he said.

It is important to understand that the issue of survivor benefits can, and frequently is, negotiated as part of the overall divorce settlement, he said.

“In order to negotiate this issue, it is often incumbent upon the non-employee spouse to obtain the necessary documentation relating to the other spouse’s retirement plan during the course of the divorce proceeding — through a process called discovery — in order to determine exactly what their rights are with regard to survivor benefits,” he said.

Roberto said there are some retirement plans that simply do not provide for survivor benefits to a former spouse under any circumstances.

“Even in those cases, however, there are other ways to provide security for the non-employee spouse,” he said. “For example, a life insurance policy could be obtained on the employee-spouse, the proceeds of which would be paid out to his or her former spouse in lieu of survivor benefits under the pension plan.”

Depending on the extent of the pension, and the length of time the employee-spouse contributed during the marriage, the associated survivor benefits may carry significant value, he said. If you are divorced and have an agreement or QDRO that which does not provide for survivor benefits, it may be too late, he said.

“If there is, however, any question whatsoever about the interpretation of the language of an agreement/order or QDRO relative to survivor benefits, it may merit having your agreement and/or order reviewed by a family law attorney to determine what options are available on a post-divorce basis,” he said.

Email your questions to .

This story was originally published on April 3, 2020.

NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.

, ,