To divide most 401(k) plans and pensions, a court order must be filed with the court. Many people who manage their divorce amicably, without attorneys, or don’t want to spend money, try to avoid this—however, it is required and delaying it can be problematic.

Institutions that manage these accounts will require a court order, either a Qualified Domestic Relations Order (QDRO, pronounced quadro) or a Qualified Illinois Domestic Relations Order (QILDRO, pronounced quildro). There are several reasons to do it at the time of or immediately following adivorce.

• If one of the parties dies before the order is entered, expect substantial legal fees and delays. The cheapest time is during the divorce—afterwards, attorneys’ rates will go up, complications will arise, and administrative fees will increase.
• You think time will make for an easier relationship with your ex. With new children, new spouses and more, it may get worse. Rip the Band-Aid off. Finish the process. Having that pending will cause more tension and expense.
• Hoping your ex dies first? Their estate will pursue this. This is not a plan from attorneys to get money—this is the law.
• The judgment/marital settlement agreement requires a division based upon the value as of the date of the entry of the judgment. How will you find or recover that later? Funds change managing institutions, records are lost, businesses close. Or it does not say the date of value? Then what? The value after 20 years of gains?
• The judgment/marital settlement agreement does not state if gains and losses are included? If you are the recipient, you will not get the gains.
• Your children and heirs may be unable to access money or sell property while this is cleared up when one of you is gone. This can truly stop distributions and inheritance.

For more information, please contact:

Wakeman Law Group, PC

741 S. McHenry Ave., Suite A

Crystal Lake, IL 60014

Ph: 815-893-6800

wakemanlaw.net