Wife shall receive exactly $22,500.00 of Husband’s Acme Oil Savings Plan (401(k)) as of April 10,
2013, which amount shall not be adjusted for investment earnings and/or losses from that date until
the date the funds are completely distributed to Wife, as set forth in a Qualified Domestic Relations
Order to be drafted by Wife’s attorney.
The settlement agreement must say what the date of division is. The account could be divided as of the date
of the mediation, the date the divorce is granted or the date the divorce decree is signed.
Wife shall receive 50% of Husband’s total account balance in Acme Oil Savings Plan (401(k)) as
of April 10, 2013, including investment earnings and/or losses on that amount from that date until
the date the funds are completely distributed to Wife, as set forth in a Qualified Domestic Relations
Order to be drafted by Wife’s attorney.
Wife shall receive 50% of Husband’s total account balance in Acme Oil Savings Plan (401(k)) as
of the date of divorce, including investment earnings and/or losses on that amount from that date
until the date the funds are completely distributed to Wife, as set forth in a Qualified Domestic
Relations Order to be drafted by Wife’s attorney.
Wife shall receive 50% of Husband’s total account balance in Acme Oil Savings Plan (401(k)) as
of the date the Final Decree of Divorce is entered (signed by the judge), including investment
earnings and/or losses on that amount from that date until the date the funds are completely
distributed to Wife, as set forth in a Qualified Domestic Relations Order to be drafted by Wife’s
attorney.
The settlement agreement must specify how decreases and increases in the account should be handled.
Language choices include:
Wife shall receive 50% of Husband’s total account balance in Acme Oil Savings Plan (401(k)) as
of April 10, 2013, including investment earnings and/or losses on that amount from that date until
the date the funds are completely distributed to Wife, as set forth in a Qualified Domestic Relations
Order to be drafted by Wife’s attorney.
Wife shall receive 50% of Husband’s total account balance in Acme Oil Savings Plan (401(k)) as
of April 10, 2013, which amount shall not be adjusted for investment earnings and/or losses from
that date until the date the funds are completely distributed to Wife, as set forth in a Qualified
Domestic Relations Order to be drafted by Wife’s attorney.
If there are any outstanding 401(k) loans, it is usually wise to add this language:
...Such total account balance shall be determined without regard to any outstanding loan owed the
plan by the plan participant, meaning the total plan balance shall not be reduced by the amount of
any outstanding loans. Husband shall be solely liable for any loans owed to the plan.
Finally, the settlement agreement should specify which party is responsible for drafting the QDRO.
...., as set forth in a Qualified Domestic Relations Order to be drafted by Wife’s attorney
A wise attorney will educate his or her client before mediation or settlement on how 401(k) plans are
characterized and valued and divided. The client needs to consider his or her need for after-tax cash now
versus tax deferred retirement in formulating a settlement strategy. Most clients benefit from consulting a
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