How to Calculate a Divorce Settlement Retirement Amount

by Micah Rubenstein

For many couples, retirement savings are the marriage's greatest financial asset. Therefore, it is critical to determine what portion of such assets are dividable in a divorce settlement. To complicate matters, there are several basic types of retirement plans, each with its own rules concerning division of assets. Here's what you will need to do in order to calculate an informed and realistic divorce settlement retirement amount.

Gather information

Call the administrators of each retirement plan and ask if the plan is employer-sponsored, IRS tax-qualified and/or covered by the Employee Retirement Income Security Act (ERISA). In each of these cases, you are entitled to a portion of any earnings that accrued during the time of your marriage.

Ask the pension plan administrators for a Qualified Domestic Relations Order (QDRO) if the retirement plan is covered by step 1. You'll need a separate QDRO for each retirement plan held by your spouse. A QDRO is a legal document that tells the pension plan administrators how to pay you your share of the benefits. Without a QDRO, the retirement plan will pay all benefits directly to your ex-spouse.

Fill out the QDROs. If your settlement agreement is straightforward, you should not encounter any problems. If your agreement is complicated, however, or if your portion of benefits is substantial, you should consider asking an attorney who specializes in QDROs to create custom QDROs for you rather than use the generic forms supplied by the pension plans. The terms of a QDRO must agree with the terms of the retirement plan as well as the terms of your settlement agreement. It can take a lot of legal finesse to craft a document that satisfies both.

Obtain a copy of any retirement plan that is not defined in steps 1-3. For any retirement plan not covered by a QDRO, enlist the services of an actuary to help you calculate your portion of any benefits. An actuary can calculate a likely scenario based on many factors, including your spouse's age, health, family medical history, etc. This scenario will be the basis for calculating your portion of benefits and will be defined as such in your settlement agreement.

Have your attorney incorporate each QDRO and actuarial report into the settlement agreement.

Items you will need

  • A copy of each retirement plan owned by your spouse


  • Company benefit plans usually begin pay out at retirement, which means that you won't receive any payments until your own normal age of retirement.


  • If you decide to make actuarial calculations yourself, make sure to have your conclusions checked by an expert.

About the Author

Micah Rubenstein has been writing professionally since 1985. He was the editor of the online publication GrailWorld Magazine, the host and producer of the weekly "Message In Music" radio series and a former professor at Kenyon College in Gambier, Ohio. He teaches at Columbus State Community College and Granite State College in New Hampshire. He holds a Bachelor of Arts in music from Brown University.