UNDERSTANDING THE BASICS OF GOVERNMENT EMPLOYEE RETIREMENT PLANS

When dealing with governmental employees at the time of divorce -- such as postal employees, civilian employees on military bases, etc., it is important to remember that they are members of one of two retirement plans: Civil Service Retirement System (CSRS) or Federal Employee's Retirement Systems (FERS).

Once a spouse's lawyer properly prepares and submits an acceptable court order for processing, the non-employee spouse who is awarded a portion of the retirement as property settlement will begin to receive benefits as the Alternate Payee as soon as the governmental employee -- called the "Participant" -- retires. These benefits are paid over the lifetime of the Participant. Should the Alternate Payee also be entitled to receive a Former Spouse Survivor Annuity, these monthly annuity payments will begin at the time the Participant dies and will continue for the life of the Alternate Payee.

An Alternate Payee can be awarded either a share of the Net Benefit -- which is the gross annuity less deductions for health insurance, Medicare, etc. -- or a share of the Gross Benefit. Although there are a number of Former Spouse Survivor Annuities available, the cost of the annuity is either deducted a) from the Employee's annuity, b) from the Former Spouse's share of the Employee's annuity, or c) from both annuities equally.

If the Alternate Payee remarries prior to reaching age 55, he/she will not be entitled to a Former Spouse Survivor Annuity under these federal retirement plans.