Expenses can easily pile up for people in Florida seeking a divorce. In addition to legal fees, a couple that needs to split the assets within a 401(k) retirement plan must first obtain a qualified domestic relations order. After paying a lawyer to prepare the QDRO document, the firm managing the retirement account typically adds another $300 to $1,800 in charges to process the transaction.
A lawyer familiar with lawsuits against investment companies that charge excessive service fees said the tactic is meant to increase profits for administrators. Another lawyer who frequently prepares QDRO paperwork described the high fees from retirement plan administrators as a “cash printing machine.”
A pension consultant explained that the large pension administration companies make it impossible to question or negotiate fees. The fee must either be paid or the administrator does not distribute the funds. Additionally, any small change or error on the form results in rejection and higher fees to resubmit the request.
Someone who has significant assets and wants to get a divorce might choose to consult a financial planner and a lawyer when negotiating the divorce settlement. Careful analysis of tax obligations, long-term effects on income, and rights to retirement accounts might be conducted by a high-asset divorce firm. The information presented to the client could guide important decisions when dividing marital assets and calculating child or spousal support. A lawyer could also offer guidance on how to obtain current valuations of real estate and business assets. Mediation or negotiation guided by a lawyer might allow the person to resolve disputes without lengthy litigation. If some issues must go before a judge, then the lawyer could advocate for a settlement that reflects the client’s needs.