Month: September 2024

For most people, our retirement plans (should we be so lucky to have them) are one of the most significant financial interests in our name – a fund to cushion your later years with some comfort, built up literally over the course of a lifetime.

Therefore, it’s no surprise that when a couple decides to divorce, plans about what to do with the money in retirement accounts, sometimes jointly owned and sometimes separately, are very complex, fraught, and have high stakes.

Especially in long-term relationships where potential decades of savings are on the line, it’s vital to be well-informed and fully prepared in a divorce to protect your and your loved one’s well-being. If you live in California, part of that preparation means being informed about QDROs.

What Is a Qualified Domestic Relations Order? 

A Qualified Domestic Relations Order, or QDRO for short, is a legal document that officially sets out all the rules, contingencies, and expectations for dividing retirement funds between exes after a divorce.

A QDRO is necessary for one spouse to access the funds in another’s savings account – in fact, you cannot legally access those funds without such a document, regardless of any other agreements in place. It must be presided over and approved by a judge and approved and managed by a plan administrator, a neutral moderator to the involved parties. The ex-partner seeking access to funds is called the “plan participant.”

How Does It Work?

Essentially, a valid QDRO document establishes the legal right of one former spouse to access the retirement savings account. Once this right is established through the QDRO, the plan administrator can direct funds from the retirement fund straight into the plan participant’s account. This cuts out red tape, as the original plan owner no longer has to be personally involved in every transfer. 

Both separating parties must determine the exact amounts used in splitting the retirement plan. The judge or plan administrator input may be necessary to reach a fair agreement.

How Do You Obtain a QDRO?

This brings us to our next topic: how exactly one gets a QDRO court order. Unfortunately, while it’s not necessarily a simple process, it’s undoubtedly doable by following the steps below:

Prepare Documentation

Unsurprisingly, preparing a QDRO requires careful documentation of the funds in the retirement plan, considering how long contributions have been going into the account, the frequency of deposits, and who is depositing funds. 

Work with a trusted bank with experience in drafting QDROs, as you will need specific forms and paperwork formatted in a particular way.

Drafting The Details of The Document

Once all the pieces are assembled and preparation handled, the separating couple can sit down and determine how funds will be shared. Hopefully, this can be a relatively quick process if both parties can reach an agreement without too much friction. Otherwise, outside mediators may need to be paid and brought in to get a compromise. 

Submit The QDRO for Approval

Once both exes have signed off on the agreement, it must be approved by the plan administrator (typically a representative of the financial institution overseeing the proceedings). The administrator may demand edits or revisions to the document, which cannot be negotiated, and may start the bargaining process over again. 

Final Review And Approval

Once the plan administrator approves the document and the couple has officially signed off and agreed to it, it can be brought before a judge for final revision and approval. The judge will sign it themselves, making the QDRO official and legally binding. 

Lastly, it is returned to the administrator at the financial institution, who can begin to administer payments. 

Common Questions About QDROs

Is There A Deadline to File?

Officially, there is no limit to when you can file a QDRO. However, for best results, it’s typically in the interest of both parties to begin the process early and get it settled.

Who Is Responsible for Filing the QDRO?

Naturally, the responsibility lies with the plan participant, the ex seeking access to the retirement plan. They must do so to receive any benefits. 

How Long Does It Take to Receive Funds?

This largely depends on the divorce process – if things are relatively amicable and communication is good, the whole thing can be done in weeks, with payments coming soon after. 

On the other hand, fraught and contentious divorces can drag on for years as both parties scrum to get the best deal on everything, quickly delaying payment for a long time.

Can I File A QDRO By Myself?

While it is technically possible to file independently, given the high stakes and technical, complex regulations that must be followed, it’s a much smarter idea to work with a trusted attorney. 

That’s where Azemika & Azemika comes in – we specialize in family law and protecting families. Contact us today for a consultation.

It’s certainly true that divorces happen almost quickly, with both parties working in agreement or mutual understanding. However, this is hardly the norm, and for a majority of people out there, divorce can be a difficult, draining, painful affair. 

In these cases, when an already strained relationship is put under the pressure of competition and high stakes, people will often make malicious or cruel decisions in the emotional heat of the moment. In other cases, spite motivates one of the exes to try and punish the other as much as possible with cold determination.

Whatever the circumstance, one of the most common attacks employed by an aggrieved divorcee is what’s known as wasteful dissipation. If you or a loved one is involved in an acrimonious divorce, read on to better protect yourself.

What Is Wasteful Dissipation?

As the name implies, wasteful dissipation is a legal term that describes one partner intentionally squandering or destroying their assets during, after, or in the lead-up to a divorce. It usually takes the form of spending of shared funds, specifically: 

• Spending in an extravagant way is noticeably different from normal spending habits.
• Spending in a way that doesn’t benefit the household.
• Spending is either done behind their partner’s back or specifically against their wishes or consent.

It doesn’t only apply to money – it can also be used to describe things like selling, destroying, or vandalizing shared property. Anything that intentionally keeps value out of your exe’s hands can be used as an example.

But the most important legal distinction of wasteful dissipation is an intent to spend or destroy assets in a way that makes them impossible or nearly impossible to get back, all in an attempt to deprive their partner of those assets. 

Thus, to prove wasteful dissipation in court, you must use evidence to demonstrate that your ex intentionally acted in bad faith by wasting money without your knowledge and/or consent and did so specifically to spite you.

Impact of Wasteful Dissipation on a Divorce Case

This is almost always an act of pure spite, intended to punish the ex first and foremost, without much thought to anything else. As such, wasteful dissipation can often be just as harmful to the person doing it as it is to their intended target. 

This manifests in the two major impacts that wasteful dissipation tends to have on a divorce case – firstly, it has the intended effect of squandering and depleting assets. If you seek to claim 50% of your shared savings, it’s much harder to do so when your ex has already spent that money on cruises, lavish meals out, vacations, etc. 

However, much like adultery, abuse, or other measurable wrongdoings, wasteful dissipation often has a negative effect on the responsible party. If a person can prove in court that their ex intentionally squandered shared assets, they have a much stronger case to be awarded assets and benefits by the judge. 

In particular, judges will often leverage either spousal support or alimony payments to punish wasteful dissipation. This way, even if the assets have been spent, the responsible party still has a financial obligation to their ex to cover at least some of the value that was lost.

Warning Signs of Wasteful Dissipation

If you are involved in a divorce or feel that a divorce is likely in your future, one step you should take immediately (if you haven’t done so already) is to start paying lots of attention to any spending records you have available. By reviewing shared accounts and credit card statements, you can spot signs of wasteful dissipation at the beginning and collect potential evidence you can use in court.

Here are some signs that your partner may be trying to waste assets to spite you:

• Sudden losses from gambling or investing in risky propositions.
• Increase in spending on non-family or un-shared expenses.
• Large purchases or unexplained expenses on shared credit cards or accounts. 
• Spending that’s visibly beyond your usual standard of living.
• Transferring money from shared accounts to hidden personal ones.
• Large and/or unusual or irregular withdrawals of cash.

These are all potential warning signs of and potential evidence for proving wasteful dissipation.

Necessary First Steps if You Suspect Wasteful Dissipation

There is one essential step you must consider before all others when getting involved in a divorce case – getting trustworthy, specialized advice on your specific situation from a reliable attorney.

At the Azemika & Azemika, not only are we a family business, but we specialize exclusively in family law. We understand the high stakes, the emotional and mental pressures, and the often painful experience of dealing with painful family issues and the complications of the legal system at the same time.

You can trust us to make your best legal interests and your well-being our first priorities. Contact us today to find out how we can help.