An NYPD officer (or other civil service employees-but for the purposes of this FAQ section the NYPD Officer will be used as an example) has a tremendous amount of retirement benefits. After twenty years of service the Officer receives: the pension; variable supplement; union benefits; deferred compensation (if the Officer is so enrolled); and any other investments the Officer may have made. This may be worth well over a million dollars. It is like hitting the lottery.
From the date of the marriage to the date of the initiation of the divorce all these funds are marital property. Think of it as a stew. All property gained during the marriage is called marital property and goes into that “stew.” There are some exceptions which are deemed by the law to be separate property. Separate property does not go into the “stew” and remains the property of the spouse to whom it belongs. Note, there are even some exceptions to that. The court divides up the “stew” at the end of the divorce giving each spouse what the court determines to be the equitable share of the “stew.” This is called equitable distribution.
For the basis of this discussion however, we will discuss only the retirement benefits, which are marital property. Accordingly, as marital property these retirement benefits will be divided between the spouses during the divorce. Note: whatever property the other spouse obtains during the marriage is also marital property, which goes into the “stew” which is divided by the court during the divorce.
The best protection an Officer can obtain to protect his/her pension is to have a prenuptial agreement. This agreement can protect your retirement benefits, a home, other real property, or anything a party wishes to protect in the event a marriage goes south.
Another way to protect your retirement benefits is to understand that your spouse may have retirement benefits as well. It is often the case wherein one party may be a Police Officer with the above-mentioned benefits, yet, the other spouse has equal benefits. In such incidents, there are strategies which your experienced attorney can employ.
Pensions are divided by what is called the Majauskas formula. Most courts follow this formula like it is the law. It is not the law, and courts have deviated from it. The courts seldom do deviate from Majauskas, but it has been done. However, this is a very fact-specific issue. Make sure you speak to an attorney experienced in this area of the law.
Most divorces are settled without trial. Often during these settlement negotiations, pension and retirement rights can be maintained. Again, this depends of the specific facts of your divorce.