U.S. Marine holds a large American flag.

In December 2016, Congress dropped a bombshell on the family law world. For the first time since the Uniformed Services Former Spouses Protection Act was enacted 33 years previously, the federal government has basically “federalized” the formula for military spouse retirement benefits.

The National Defense Authorization Act, or NDAA, is the statute which sets funding levels and policies for the Department of Defense. Only rarely does the NDAA affect military divorces, but the 2017 NDAA changed military spouse retirement benefits with the “Frozen Benefit Rule.”

Although the law is now more than two years-old, there is still a surprising amount of misinformation on the internet, even on legal websites, which seem unaware of the no-longer-new law, or just have not been updated in several years, and the obsolete pages still refer to the way things used to be.

WARNING – this blog is somewhat math-heavy, because the only way to explain how military spouse retirement benefits are affected by the Frozen Benefit Rule is with actual examples. While the client may not need to understand the math behind the division of military retirement in a Colorado divorce, but your military divorce attorney better understand it!

Hunt Formula for Military Spouse Retirement Benefits

Like many government pensions, military retirement is a “defined benefit pension plan,” under which an employee is paid a monthly retirement based upon a combination of years of service and salary. Contrast that to a “defined contribution” plan, such as an IRA or 401(k), where the account balance earned during marriage is simply divided at divorce.

The military retirement has long been based upon the following formula:

2.5% ✖ Years of Service ✖ “High 3 Pay” (Avg highest 36 months of basic pay).

By way of example, a military member retiring at 24 years whose basic pay averaged $8000 over the 36 months immediately prior to divorce would receive a military retirement of $4800/mo (2.5% x 24 x $8000). And if the employee (or military member) was promoted after divorce, the actual retired pay, including increases due to the promotion, were divided and shared with the former spouse.

In a Colorado divorce, courts traditionally divided all defined benefit pensions using the Hunt formula, by which the marital share was determined as follows:

Months of marriage overlapping service
Total service at time of retirement

Let’s assume a marriage of 11 years, with the member retiring at 24 years of service with the $4800 retirement set forth above. The marital share would be 45.8% (11/24). And multiplying 45.8% by the $4800 retirement, the marital share would be $2200. The military spouse retirement benefits are half of the marital share, or $1100/mo.

Every non-military defined benefit pension (PERA, FERS, etc) is still divided using the Hunt formula. So if one spouse is a school teacher at the time of divorce, but by the time of retirement had moved his way up to school principal, then district superintendent, the other spouse’s share of the pension included the increases due to those promotions.

How the Frozen Benefit Rule Changes Military Spouse Retirement Benefits

The Frozen Benefit Rule changed how state divorce courts can divide military retirement while the member is still on active duty or in the reserves at the time of divorce. Under 10 U.S. Code § 1408(a)(4)(B), the marital share of the retirement is calculated and divided based upon the member’s rank and years of service at the time of divorce, not at the time of retirement.

While the former spouse will receive the benefit of COLAs, she will not share in any pay increases due to the post-divorce promotions or longevity increases (i.e. going over 12, 14, 16, etc. years of service).

The Frozen Benefit Rule formula for dividing a military retirement at divorce starts with:

Months of marriage overlapping service
Total service at time of decree

So far, so good. The frozen benefit numerator is the same as the Hunt formula – the months of marriage overlapping service.

And the denominator will actually be lower than under Hunt – the total months of service at the time of divorce, not total months of retirement. So until we dig deeper, the frozen benefit rule seems helpful to military spouse retirement benefits. Using the hypothetical from above, let’s assume the spouses were married for the first 11 years of the member’s 24-year career. At the time of divorce, there were exactly 11 years of marriage overlapping 11 years of service.

The marital share would be 100%, compared to 45.8% under the Hunt formula.

But here’s the catch – the result of that equation is multiplied not against the total military retirement at the time of actual retirement, but against the retirement earned as of the date of the divorce. Regardless of whether the member has more than 20 years, so the retirement is vested, or fewer than 20 years, so it’s a hypothetical retirement, the formula is the same: 2.5% ✖ however many years of service.

Back to our hypothetical, let’s assume that at the time of divorce the member’s high-three pay was $4000/mo. The military retirement earned after 11 years of service would therefore be $1100 (2.5% x 11 x 4000).

So the marital share under the frozen benefit rule would be 100% x $1100, compared to the marital share under the Hunt coverture formula of 45.8% x $4800, or $2200 total.

The military spouse retirement benefits are half of that $1100 marital share, or just $550/mo, compared to $1100/mo under the coverture rule. The Frozen Benefit Rule has cost the former spouse $6600/yr of the military pension.

Can a Military Retirement Be Divided Using Coverture Formula?

The 2017 NDAA applies to divorce decrees issued after December 23, 2016. If a military retirement was divided in a decree prior to that, DFAS will accept the Hunt formula and award the former military spouse retirement benefits based upon the more generous “coverture” formula.

Likewise, if the member is already retired at the time of divorce, he/she will not have any post-divorce promotions or longevity increases, so the frozen benefit rule and the coverture formula yield the same result.

But for decrees issued since 12/23/2016 when the member is still serving in the military, the decree or separation agreement must follow federal law, or DFAS will reject it. Even by agreement, the spouses cannot “opt out” of the frozen benefit rule and apply the old formula.

How About the Blended Retirement Plan?

The blended retirement plan, introduced in 2018, applies only to military members who:

  1. Joined the military after January 1, 2018, or
  2. Had fewer than 12 years of service as of that date AND opted for blended retirement during 2018.

Under the blended retirement, the multiplier decreased from 2.5% per year of service to 2%, and added a variety of other benefits, including an expanded TSP with a government match.

For a complete discussion of everything that the blended retirement plan changed, see the article Understanding Military Retirement Pay in the Military Divorce Guide. A quick teaser – the blended retirement plan is also potentially not good for former military spouse retirement benefits.

You Need a Lawyer Who Understands This Stuff!

Military Spouse Retirement Benefits Frozen

If your head has stopped spinning, and you would like a more thorough discussion of how the Frozen Benefit Rule applies to the division of military retirement in a Colorado divorce, see the Calculation of Military Retirement Pay & Shares article in the Military Divorce Guide. As a bonus, the article also has a link to our Military Retirement Calculator.

At Graham.Law, our Colorado Springs military divorce attorneys truly understand the frozen benefit rule and its impact on military spouse retirement benefits. And our managing partner (yours truly) has taught hundreds of attorneys how to divide military retirement at statewide CLEs (see sample outline from one recent presentation).

If you have a military divorce in Colorado Springs, please consider our firm, and if your case is outside the 4th Judicial District, make sure your attorney understands the frozen benefit rule. Getting this wrong, including applying the old law, will result in DFAS rejecting your retirement order.

FAQ – Military Spouse Retirement Benefits

How is military retirement divided in divorce?

Though some states may do things a bit differently, in Colorado the “frozen benefit rule” means that the marital share is the months of marriage overlapping military divided by the total months of service at the time of the decree, which is then multiplied by the retirement the member has earned at the time of the decree.

What is the blended retirement system?

Under the blended retirement system, the multiplier for the military pension is reduced from 2.5% per year of service to 2% per year, and in return, there is a government match into the TSP and continuation pay bonus.

How long do you have to be married to get retirement in a divorce in the military?

There is no specific duration of marriage required for a state court to award a former spouse a share of the military retirement. However, DFAS will only pay the former spouse directly if there were 10 year of marriage overlapping service.

In a divorce does the spouse get half of a military retirement?

No. In divorce, the spouse will receive one-half of the marital share of the military retirement, and only if the spouse were married to the member for his entire career would that result in one-half of the whole retirement.

Where can I find an attorney for military retirement divorce law?

See if the local military JAG office has a referral list, or try searching the web for “military divorce lawyer near me”. If your case is in Colorado Springs, we would be honored if you would consider Graham.Law.

Award-Winning El Paso County Military Spouse Retirement Benefits Lawyer

Graham.Law Team

U.S. News & World Report calls Graham.Law one of the Best Law Firms in America, and our managing partner is a Colorado Super Lawyer. Our family law attorneys have years of experience helping clients navigate the Colorado legal system. We know Colorado divorce & family law inside and out, from complex multi-million dollar property or child custody cases to basic child support modifications.

For more information about our top-rated El Paso County family law firm, contact us by filling out our contact form, calling us at (719) 630-1123 to set up a free consult, or click on:

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