The Disparate Impact of ERISA on Spousal Wealth

Paula A. Monopoli (professor of law, University of Maryland) has published her article entitled Marriage, Property and [In]Equality: RemedyingERISA’s Disparate Impact on Spousal Wealth, 119 Yale L.J. 61 (2009).   

An excerpt from the article is below:

ERISA provides that employees may not assign or alienate their interest in a defined contribution plan.  The underlying policy rationale of this provision is to “protect an employee from his own financial improvidence” with respect to retirement accumulations.  This “spendthrift” provision effectively precludes a married couple from holding such defined contribution plans in joint names, resulting in a concentration of wealth in the hands of the spouse – typically the husband – that is more consistently in the labor market.  Thus, as defined contribution plans become an increasingly significant percentage of household wealth, husbands have concomitantly larger shares of the family wealth held in their names alone.