PENSION BENEFITS REPORT
What happens to my
pension if I get divorced?
One of the many questions I get references our
pension and divorce—so many, in fact, that I have
decided to let you know some quick facts on this
topic.
The good news is that our pensions are usually
exempt from any liens; the bad news is that the Di-
vision of Pensions will honor court orders for child
support, alimony or equitable distribution because
of court decisions and opinions given by the New
PETER
Jersey Attorney General. That means that the re-
ANDREYEV tirement systems have allowed the implementation
of matrimonial/civil union dissolution court or-
ders granting alimony, support or equitable distribution against a
member’s monthly retirement allowance.
Just so you know, it is your responsibility to provide the Division
of Pensions with copies of all court orders so as to comply with the
provisions of those court orders. Now I know what you’re thinking:
“If I don’t send it, how will they know?” I am sure your ex-spouse’s
lawyer will gladly send the Division of Pensions the court order if
his or her client is entitled to a sum of money.
Filing for divorce or a dissolution proceeding is a good time for
you to re-assess your beneficiary designation. It’s also a good idea
to think about who you want listed as your beneficiary before,
during and after the completion of the divorce proceedings. There
is a statute in New Jersey that says that even if you designate, or if
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■ OCTOBER 2018
the beneficiary information indicates, your former spouse or rel-
atives of your ex-spouse as beneficiaries, they cannot receive the
benefit. (N.J.S.A 3B:3.14) The pension and/or life insurance pro-
ceeds become payable to your remaining primary beneficiaries,
contingent beneficiaries or estate. As always, there a few excep-
tions. One exemption involves a court order that specifically des-
ignates your ex-spouse to receive a pension and/or life insurance
benefit; in another, you sign and file a designation of beneficiary
for after the final date of judgement that names your ex-spouse
or former relatives of your ex-spouse as pension and/or life insur-
ance beneficiary.
When you have reached retirement, the QDRO/Divorce Decree
regarding your retirement will take effect once you begin receiving
your monthly retirement allowance. The court order can desig-
nate a specific dollar amount, a percentage or a percentage based
on the number of years of pensionable service that you accrued
during your marriage to be withheld from your retirement allow-
ance. The amount of money will be sent directly from the Division
of Pensions to your former spouse. Any court-ordered payment to
your former spouse will stop when you die, or when your former
spouse dies. So let’s hope for your sake that you outlive your for-
mer spouse in retirement.
If you have a question regarding this or any other pension-re-
lated topic, you can reach me at the NJSPBA office by phone or
email. d