PENSION AND BENEFITS REPORT
Divorce and your pension: Not so perfect together
I have been getting so many
questions about pension and
divorce that I decided to focus
this month’s column on the topic.
The good news is that our
pensions are usually exempt
from any liens, but the bad news
is that the division of pensions
will honor court orders for child
PETER
support, alimony or equitable
ANDREYEV distribution because of court
decisions and opinions given by
the New Jersey Attorney General.
That means the retirement systems have allowed
the implementation of matrimonial/civil union dissolution court orders 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. Now I know what you’re thinking: if I don’t
send it how will they know? I am sure your exspouse’s lawyer will gladly send the Division of Pensions the court order when they know that their
client is entitled to a sum of money.
When you are filing for divorce or a dissolution
proceeding, it would be a good time for you to reassess your beneficiary designation. It may be a
good idea to think about who you want to be listed
as your beneficiary before, during and after the
completion of the divorce proceedings. There is a
statute in New Jersey that states if you designate
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NEW JERSEY COPS
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APRIL 2015
your former spouse or relatives of your ex-spouse as
beneficiaries, they cannot receive the benefit
(N.J.S.A 3B:3.14). The pension and/or the life insurance proceeds become payable to your remaining
primary beneficiaries, contingent beneficiaries or
your estate.
As always, there are a few exceptions. One of
which is if there is a court order that specifically designates your ex-spouse to receive a pension and/or
the life insurance benefit, or 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
insurance beneficiaries.
When you have reached retirement, matrimonial
orders regarding your retirement will take effect
once you begin receiving your monthly retirement
allowance. The court order can designate a specific
dollar amount, percentage or a percentage based
on the number of years of pensionable service you
have accrued during your marriage to be withheld
from your retirement all