Glossary
The terms that show up in QDROs, valuations, and settlement talks — defined the way plans and courts actually use them.
A single payment that replaces a stream of future support payments, typically negotiated off the stream's present value with a discount for the certainty the recipient gains. Calculator →
The spouse, former spouse, child, or dependent named in a QDRO to receive part of a plan participant's retirement benefit. Only an alternate payee can be paid under a QDRO. QDRO guide →
An annual increase to pension payments meant to keep pace with inflation. A pension with a COLA is worth meaningfully more than the same benefit without one — it belongs in any valuation.
An attorney fee charged as a percentage of the recovery rather than by the hour — commonly 33⅓% pre-suit and 40% after filing. Whether it's taken before or after case costs is a contract term worth checking. Calculator →
Years of plan service during the marriage divided by total years of service — the standard way courts isolate the marital share of a pension earned partly before or after the marriage. Calculator →
A traditional pension: the employer promises a monthly benefit at retirement based on a formula (years of service × pay × multiplier). Dividing one means valuing a promise, not splitting a balance.
A plan with an account balance — 401(k), 403(b), profit-sharing. Division is a dollar or percentage split of the balance as of a valuation date, plus or minus market movement after it.
The interest rate used to convert future dollars into today's dollars. Small changes move valuations a lot: a higher rate shrinks the present value of any payment stream. See it in action →
The Employee Retirement Income Security Act of 1974 — the federal law governing private workplace retirement plans. It bars assigning benefits to anyone but the participant; the QDRO is the divorce exception it carves out.
What a willing buyer would pay a willing seller, neither under compulsion, both informed. The default standard in most valuations — and the one that allows minority and marketability discounts.
A statutory standard used in shareholder disputes and some divorce courts — often fair market value without discounts. Which standard applies can swing a business valuation by 20–40%.
The order language saying whether the alternate payee's share is adjusted for market movement between the valuation date and the transfer. Silent orders usually mean a flat dollar amount — someone eats the market move. Calculator →
A third party's legal claim on your settlement — health insurers, Medicare/Medicaid, or hospitals recovering what they paid for treatment. Liens come out of the net and can often be negotiated down. Calculator →
The whole settlement paid at once. Full control and full market risk — compare it to a structured offer only in present-value terms, never against the nominal total. Calculator →
Assets acquired during the marriage, regardless of whose name is on them — including retirement benefits earned during those years. What's divisible; the counterpart of separate property.
A reduction in a private business interest's value because there's no ready market to sell it in — often 10–35%. One of the most-litigated numbers in valuation disputes.
The entity that runs a retirement plan and decides whether a domestic relations order is "qualified." Plans follow the administrator's procedures and model language — not your settlement agreement. Model language guide →
What a future payment or stream of payments is worth today, at a chosen discount rate. The common denominator that lets you compare a pension, a buyout, and a lump sum on the same footing. Calculator →
A court order, accepted by the plan, that pays part of a participant's ERISA retirement benefit to an alternate payee. The only way to divide a private workplace plan without taxes or penalties. Full guide →
The plan administrator's formal determination that a domestic relations order meets ERISA's requirements and the plan's terms. Until an order is qualified, nothing moves. When it fails →
Moving a QDRO award into an IRA tax-free. It preserves tax deferral — and permanently closes the one-time window to take cash without the 10% early-withdrawal penalty. Calculator →
Assets owned before the marriage, or received by gift or inheritance during it. Not divisible — but commingling it with marital funds can convert it, which is what tracing disputes are about.
A settlement paid as a scheduled stream — often through an annuity — instead of one check. In physical-injury cases the payments are generally income-tax-free, which changes the comparison math. Calculator →
The pension feature that keeps payments flowing to a former spouse after the participant dies. If the QDRO doesn't award it, the alternate payee's share can end at the participant's death. Guide →
The mechanism for dividing an IRA under a divorce decree — no QDRO involved. Labeled and executed correctly, it moves money between spouses' IRAs with no tax. Tax guide →
A direct custodian-to-custodian move of retirement money that never touches your hands — avoiding the mandatory withholding and 60-day-rollover traps of taking a check.
The date an asset is measured for division — filing, separation, or trial, depending on the state and the agreement. In a moving market, choosing it is choosing the number. Calculator →