The California Public Employees Retirement System (CALPERS) provides lifetime monetary benefits to employees and their spouses. If you have filed for divorce, you may be wondering how you or your spouse’s CALPERS pension may be affected. Depending on your marital settlement agreement, you may receive up to half of your spouse’s CALPERS retirement. Below is an overview of the CALPERS pension retirement division process in divorce. Read on to learn more.

Overview of CALPERS Pension Retirement Division

CALPERS is a defined benefit plan. It is codified by the California Public Employees Retirement Law. During a divorce, defined benefit plans are divided between spouses. This is in accordance with California’s community property laws. Unless the parties agree otherwise, California laws require a 50/50 division of community property marital assets. CALPERS pension plan is considered an asset. 

In order to begin a CALPERS pension retirement division, the spouse seeking to enforce the judgment must join the Plan in the divorce proceedings and file a Qualified Domestic Relations Order (QDRO) with the court. Ideally, the QDRO should be drafted shortly after the judgment is entered. In order to properly complete a CALPERS pension retirement division, the judgment must contain specific instructions to CALPERS on how the retirement plan is to be divided. 

CALPERS Requires Joinder in Divorce

It is important to formally join CALPERS in the divorce as an interested, third-party claimant. In fact, CALPERS requires the retirement plan be formally “joined” as a party claimant in all California divorce cases. This requires the preparation and filing of Joinder documentation with the court in the family law case.  The filing of the Joinder will make sure that a hold is placed on the retirement account until the issue is resolved with the court. CALPERS must be served and provided with legal notice of joining the CALPERS retirement plan.  CALPERS has 30 days to respond. The filing and serving of the Joinder alerts CALPERS that the spouse of the Participant has a community property interest in the retirement account. It also alerts CALPERS that a claim is being made against that account. This must be done before filing the QDRO. After the QDRO is drafted, it is recommended to send it to CALPERS for preapproval. Once CALPERS approves the drafted QDRO, it can be filed and sent to the judge for signature. The filed QDRO is then sent to CALPERS for final administration.

Ways to Divide a CALPERS Pension Retirement

CALPERS will process the division of benefits once it receives a certified copy of the filed QDRO. A CALPERS pension can be divided in one of the following two ways:

  • Account Rollover

The non-member spouse can ask for the retirement account to be separated prior to the member spouse’s retirement. The balance of the account will be half of the sum grossed during the marriage to the date of separation. The non-member spouse can request to roll over the funds into their own account.

  • Monthly Benefit

Non-retired members can ask for the community property interest in the pension to be separated into 2 accounts: one in the name of the member and non-member spouse. The non-member spouse will receive a lifetime benefit equivalent to his/her community property interest. The non-member spouse will receive a monthly allowance upon reaching the designated age for retirement.

A non-member spouse is not entitled to health benefits. Health benefits cannot extend beyond the last day of the month in which the marriage terminated. Such health benefits are not subject to a QDRO.  

If you are dividing a CALPERS retirement plan in a California divorce, A People’s Choice can help you prepare the Joinder documents in addition to the QDRO. If you need help with your CALPERS pension retirement division, contact A People’s Choice by calling 1-800-747-2780 to speak with one of our experienced staff.

Get help with your Legal documents today!

A People’s Choice can save you hundreds of dollars by preparing your legal documents instead of an expensive attorney!

We would love to know your thoughts on this article. Connect with us over on Google+ or Twitter and join the conversation