On March 15, 2018 Attorney Erwin Kratz presented a webinar which detailed practical approaches to solving the various complications that can arise when dividing defined contribution plan accounts, including approaches to dealing with the pre-marital money problem and opportunities presented when offsetting accounts against each other. In this Webinar we addressed:
Where and how to get an accurate account balance on the date of marriage (DOM) when faced with the pre-marital money problem
Adjusting the DOM balance for earnings through the end of the marital community, including how to estimate earnings on pre-marital money:
based on the way the account was invested on the date of marriage or on the date of division, or
using broad proxies (such as the S&P 500 index, target date retirement funds, and the DOL’s VFCP Online interest calculator)
How to determine which account your client is best off taking and which they are best off giving away when offsetting the balance in one account against another.
On November 9, 2017 attorney Erwin Kratz presented a webinar detailing the various challenges in dividing military retired pay after the 2017 NDAA Amendments, especially in relation to the commonly used Van Loan formula.
The 2017 National Defense Authorization Act changed the definition of “disposable retired pay” in 10 U.S.C. 1408(a)(4) in a way that requires use of monthly retired pay as of the date of divorce, rather than as of retirement, for purposes of dividing military retired pay.
This webinar covered:
Why (and how) the NDAA modifies, but does not completely kill, the Van Loan formula when dividing military retired pay
Issues particular to the following situations:
Pre-retirement v. post-retirement divorce
Pre-marital service v. no pre-marital service
The Former Spouse will get less than 50% of the total disposable retired pay
The Member entered service before v. after 9/1/1980
Reserve v. Active duty retirement
Promotions made within 3 years of the date of service in the divorce
The article explains how it is critical to understand the features of each retirement benefit, to can get your fair share of this important community asset. The first step is to correctly identify the type of retirement plans involved. The article details issues to consider when dividing benefits in the three broad types of retirement plans-
Defined Contribution Plans (Both private and governmental)