How Does the Clients Age Impact on QDRO Negotiations?
Dividing the participant’s pension benefits remains as the final settlement issue. In this example, the participant is 65 years old and preparing to retire on a $2000-per-month pension. It has been assigned a present value of $223,690 by the pension evaluator. In representing the 70-year-old nonparticipant spouse, you and opposing counsel agree to a QDRO that provides your client with 50 percent of the participant’s monthly pension benefits because there are no other significant offsetting assets. Under a defined benefit pension plan, a participant’s monthly accrued benefit typically commences on an unreduced basis at his normal retirement age, usually age 65. From a simplistic standpoint, the actuarial present value of a participant’s monthly pension annuity as of his normal retirement date is the amount of money needed to fund the annuity for the remainder of his lifetime. Remember that when it was agreed that the nonparticipant would receive 50 percent of the participant’s pension b
