What Happens to the Five Below 401(k) Retirement Savings Plan During Divorce?
Dividing retirement accounts is often one of the most technical and contested parts of divorce. If you or your spouse participates in the Five Below 401(k) Retirement Savings Plan, you’ll likely need a Qualified Domestic Relations Order (QDRO) to divide the account properly under federal law. A QDRO helps protect both parties and ensures the division is handled according to IRS and ERISA rules.
As QDRO attorneys at PeacockQDROs, we’ve finalized thousands of retirement divisions across 401(k) and other plans. What makes our process different is we don’t just draft the order—we handle everything from drafting to court filing, preapproval (if needed), submission, and follow-up with the plan administrator. We do it the right way, the first time.
Plan-Specific Details for the Five Below 401(k) Retirement Savings Plan
Here is what we know about this specific plan:
- Plan Name: Five Below 401(k) Retirement Savings Plan
- Sponsor: Five below, Inc.
- Address: 701 Market Street
- Plan Type: 401(k)
- Organization Type: Corporation
- Industry: General Business
- Status: Active
- Effective Date: Unknown
- Plan Number & EIN: Required but currently unknown (these will need to be obtained to complete your QDRO)
- Plan Year: Unknown to Unknown
- Assets and Participants: Data not currently available
Because this is a corporate retirement plan type governed by ERISA, a QDRO is required to lawfully split the account and shield both parties from tax penalties.
Understanding QDRO Basics for a 401(k)
In a divorce, a QDRO is a legal document that outlines how retirement assets like a 401(k) are to be divided between the plan participant (called the “Participant”) and their spouse or ex-spouse (called the “Alternate Payee”).
Without a QDRO, the plan administrator cannot legally transfer any portion of the account to the former spouse. Also, any division done without a QDRO could trigger tax consequences and early withdrawal penalties.
Key Issues When Dividing the Five Below 401(k) Retirement Savings Plan
1. Employee vs. Employer Contributions
The Five Below 401(k) Retirement Savings Plan likely includes both employee deferrals and employer matching or discretionary contributions. Splitting this account means determining which of those contributions (and the associated earnings) are marital property based on your state’s laws and date of division.
In QDROs for 401(k) plans, it’s common to divide:
- Total account balance as of a specific date (like date of separation, date of divorce, etc.)
- A percentage of the balance earned during the marriage
- A flat dollar amount
The exact method depends on your divorce settlement or court order.
2. Vesting Status and Forfeitures
Employer contributions are often subject to a vesting schedule. If the Participant hasn’t worked at Five below, Inc. long enough, part of the employer-funded balance may not be “vested.” In that case, the non-vested portion cannot be awarded to the Alternate Payee in the QDRO and is subject to forfeiture rules.
We routinely assist clients in reviewing their plan statements and Summary Plan Descriptions (SPDs) to confirm what is vested and divisible.
3. Loan Balances in the 401(k)
If the Participant has taken out a loan against their Five Below 401(k) Retirement Savings Plan, that loan balance will usually stay with them during the divorce. However, the QDRO should specify whether the loan amount is deducted from the gross or net account balance. This is one of the biggest causes of disputes—and mistakes—without a properly drafted QDRO.
Make sure loan treatment is spelled out explicitly in your QDRO to avoid surprises.
4. Roth Versus Traditional 401(k) Balances
Many modern 401(k) plans include both pre-tax (traditional) and post-tax (Roth) contributions. These are two very different account types with different tax implications. A good QDRO should divide both types appropriately and instruct the plan administrator to maintain their tax character when transferred to the Alternate Payee.
If the QDRO is vague or silent about this, the administrator may only divide one portion—leaving the parties with an incomplete division and triggering a potential tax or legal issue.
How Long Does It Take to Get a QDRO Approved?
There’s no one-size-fits-all answer here. Several factors determine how long a QDRO takes to finalize, including court processing, plan administrator reviews, and whether the draft needs pre-approval. We’ve published a detailed breakdown here: 5 Factors That Determine QDRO Timing.
Common QDRO Mistakes in 401(k) Plans
We’ve worked with countless clients who tried to handle their QDRO on their own or used a general divorce attorney who didn’t specialize in retirement orders. Some of the most common mistakes include:
- Not correctly identifying plan information
- Failing to address loans or Roth balances
- No clear division date or allocation formula
- Using generic templates that don’t satisfy plan requirements
A good starting place to learn more is our guide on common QDRO mistakes.
Why Use PeacockQDROs?
At PeacockQDROs, we’ve completed thousands of QDROs from start to finish. That means we don’t just draft the order and leave you to figure out the rest. We handle the drafting, preapproval (if applicable), court filing, submission, and follow-up with the plan administrator. That’s what sets us apart from firms that only prepare the document and hand it off to you.
We maintain near-perfect reviews and pride ourselves on a track record of doing things the right way. We know corporate 401(k) plans like the Five Below 401(k) Retirement Savings Plan inside and out, and we give you a clear path forward—whether you’re the Participant or the Alternate Payee.
You can learn more about what working with us looks like at our main QDRO service page here: https://www.peacockesq.com/qdros/.
Important Next Steps
If you are dividing the Five Below 401(k) Retirement Savings Plan, here’s what we suggest:
- Confirm with your divorce attorney or court what date or formula should be used to divide the account.
- Obtain the plan’s Summary Plan Description or contact the Plan Administrator to confirm vesting, account types, and loan information.
- Contact a QDRO attorney who specializes in retirement division. Don’t use a template or DIY form.
Your divorce decree may say your spouse or you are entitled to the 401(k) benefits, but without a legally accepted QDRO, that division won’t happen.
State-Specific Call to Action
If your divorce was in California, New York, New Jersey, Connecticut, Kansas, Missouri, Iowa, or North Dakota, and you have questions about qualified domestic relations orders or dividing retirement assets like the Five Below 401(k) Retirement Savings Plan, contact PeacockQDROs. We specialize in QDROs and have successfully processed thousands of orders from start to finish.
Get the answers you need—explore our QDRO resources or reach out for personalized help if you’re in one of our service states.