In this podcast, Family Lawyer Magazine publisher Dan Couvrette interviews pension and QDRO expert Tim Voit and family lawyer Robert Burgs about the role of a Certified QDRO Specialist, and the value of becoming a member of the American Association of Certified QDRO Professionals.
Tim Voit is a financial analyst and founder of the American Association of Certified QDRO Professionals. He concentrates on QDROs, QDRO distribution, and evaluation of retirement plans for offset purposes. He has been admitted as an expert in both state and federal courts and is often called upon in legal malpractice suits to fix QDROs or to compute or minimize damages for insurance carriers. www.aacqp.org Robert Burgs is a family law attorney in the Fort Lauderdale area; he has 30 years of experience practicing family law. www.robertdburgslaw.com
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What does it mean to family law attorneys to be certified in preparing Complex QDROs?
Voit: It gives the family law attorney reassurance that the QDRO professional they retained has the requisite background in QDROs and to handle the most complex QDRO issues.
The American Association of Certified QDRO Professionals was established to provide an education in QDROs, provide guidance in QDRO preparation, and – most of all – to protect the candidate from liability exposure and to protect the client from ill-prepared QDROs.
As an experienced family law attorney, what purpose does having a certification serve? How does it benefit you or your clients?
Burgs: Aside from being a family law attorney I am also a mediator. Going through the certification course has given me an enormous amount of ammunition going into negotiations as oftentimes attorneys are not well-versed in QDROs. Retirement plans and account issues are in the majority the divorce cases I deal with. This course reaffirmed many of the things I knew about QDROs during my 30 years of practice – but it also provided a wealth of information related to all types of QDROs or similar orders that I simply was not aware of.
If retirement plan issues are in the majority of divorce cases, would someone who isn’t certified be at a disadvantage?
Burgs: Absolutely. Dealing with retirement plans requires a broad range of knowledge that you simply cannot get through experience alone. No one person with a specific background in pension plans is going to know everything there is to know given that there are so many plans from those in the private sector to federal pensions and military, state and municipal pensions – some that accept QDROs and some that don’t. It is impossible for a family law attorney to keep up with everything that each of these plan administrators want to see in the QDRO. As the course emphasizes, a slight change in verbiage can mean tens of thousands of dollars in favor of one or the other spouse.
Voit: All four modules of the Certified QDRO Specialist program are very comprehensive; they deal with issues that only someone with over 25 years of experience would encounter. For those just starting out, all of those years of experience are wrapped up in one program.
If the family law attorney had a choice between two QDRO preparers – both with say five years of experience – but one of them has completed the program, being certified will give the professional more credibility and knowledge than someone who dabbled in QDRO preparation for five years – and who may have a background entirely unrelated to QDROs.
I think the courts would consider the certified professional to be more of an expert than someone with no specific education in QDROs.
What is the typical background of candidates or actual Certified QDRO Specialists?
Voit: Typically attorneys and paralegals – but we see quite a few forensic accountants, divorce financial analysts, and HR professionals.
I can understand paralegals, attorneys, and CDFAs, but how does it benefit HR professionals?
Voit: It is the plan administrator that qualifies the domestic relations order; in the private sector, HR professionals are often given this responsibility of qualifying QDROs.
The course covers in detail the plan administrator’s responsibility from providing QDRO guidelines, which are required by the Department of Labor, to preparing a model QDRO for their own firm.
What did you find to be the most complex or difficult issue when going through the Certified QDRO Specialist course?
Burgs: The difference between how retirement plans are divided in the private sector versus how others like the military or federal government allow for the division of their retirement plans.
Aside from all of the differences – which spell disaster for an attorney if they don’t know them – is how to reduce your liability. An attorney can make their clients aware of what to expect from a QDRO or a retirement plan.
And the program illustrates how most – if not all – QDROs can be skewed in favor of one or the other party.
What does it take to become certified? How many modules are there?
Voit: There are four levels, or modules, for the Certified QDRO Specialist designation; you can see the underlying subject matter by visiting aacqp.org.
- Basically, the first module is an introduction to QDROs, the various types, and how they are treated in divorce.
- The second module is on the actual drafting or preparation of QDROs, getting into quite a bit of detail on specifically what to do and what to watch out for.
- The third module concentrates on federal retirement plans for federal employees.
- The fourth module covers dividing military retired pay and specialty orders for plans that do not accept QDROs, including state retirement systems.
All four look at what might be the pros and cons depending who the candidate or attorney represents.
Aside from preparing QDROs, the program covers federal employees and military servicemembers. Is a QDRO practitioner likely to encounter the division of federal or military retirement plans?
There are over 3 million federal employees across the country, so whoever may be in the business of drafting QDROs will receive a fair share of orders dividing federal pensions.
With regard to other government entities, non-federal, and related to Module 4, there are roughly 19 million employees across the country that work for a government entity that is not the federal government.
Factor in another 1.3 million full-time and reservist members and yes: it is highly likely that an individual holding themselves out as a QDRO professional will encounter military and government plans.
Thrsr numbers do not include the 200 to 500 traditional QDROs being drafted per year.
What attracted you to the Certified QDRO Specialist program?
Burgs: 2 things were appealing, the first being having the knowledge and second being the additional revenue it can generate. Most attorneys do not want to touch QDROs primarily because it is too much for them to try and figure out. I dabbled in them taking the easy ones and farming out the rest. Here, you still have that option but you can prepare quite a few more than just the basic ones. So having the knowledge is a direct correlation to the enhanced revenues.
Aside from the Certified QDRO Specialist designation, there is the Certified QDRO analyst (CQA) designation. Can you tell me something about that certification?
Voit: The CQA program will be released in 2018. It is a program that is more analytical whereas the QDRO Specialist program is theory and practical application. The QDRO analyst program consists of 3 modules and is more mathematical or encompasses more financial calculations. It is designed this way so that the QDRO Specialist has less math and more practical applications whereas the Certified QDRO Analyst involves more case studies, a combination of calculations and drafting skills.
Is QDRO preparation something an attorney can make a living at?
Burgs: Of course. Naturally, an attorney would get certified and use it as a revenue enhancer to their existing operation. No doubt it will grow into a business in itself with the right marketing plan.
Aside from learning how to prepare QDROs, what is the most important thing to take away from a program like this?
Voit: How to advise on drafting settlement agreements
Burgs: How to draft settlement agreements when significant retirement assets are involved. A QDRO has to be drafted taking into account the language in the settlement agreement. Errors or sloppiness in drafting settlement agreements can have a tremendous effect on what is contained in the QDRO.
Aside from Family Lawyer Magazine, AACQP received some press in Forbes magazine and Reuters. What can you tell us about that?
Voit: Under the auspices of AACQP, I worked on a project with two writers at Forbes to determine first the retirement wealth of the presidential candidates and then the retirement wealth of the incoming cabinet members. It became a feature article. The Reuters article was on the liability issues around poorly-drafted QDROs.
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