What is an example of the deferred division method of pension division?

The deferred division method of pension division allows each spouse to receive a share of the pension benefits when they are actually paid out, rather than at the time of divorce. This method is particularly beneficial in valuing a pension that will not be disbursed until a future date, often at retirement. In this arrangement, the court will typically specify the percentage or amount that each spouse is entitled to receive once the pension payments begin. This ensures that both parties share in the benefits as they materialize, which reflects the principle of equitable distribution by acknowledging the contributions of both spouses over the course of the marriage.

In contrast, the other options illustrate different approaches to pension division. The lump sum payment option involves an immediate settlement that compensates one spouse now for future benefits, which does not adhere to the deferred nature of the method. Immediate payout upon divorce also does not capture the essence of deferred division, as it results in a current transaction rather than future benefit sharing. Lastly, the forfeiture of benefits means that one spouse would receive nothing, which contradicts the goal of equitable distribution inherent in the deferred division method.