Divorce and Retirement Planning
There are plenty of statistics to suggest that many, if not most, people who marry won't stay that way forever. The National Center for Health Statistics and the Centers for Disease Control and Prevention released data for 2009 that showed a marriage rate of 6.8 per 1,000 people, and a divorce rate of 3.4 per 1,000 people.
Given the high incidence of divorce, your retirement planning efforts may have to adjust to unanticipated changes in marital status. Simply put, divorce is one of a handful of commonly encountered situations that affect retirement planning. If you or your spouse have been fortunate enough to accrue pension rights or other retirement savings, the disposition of these benefits will be of great concern to you when you work out your property settlement. In the vast majority of states, your retirement benefits are considered an economic resource that is subject to some form of apportionment between you and your spouse.
 |
Warning
The valuation and apportionment of retirement benefits between divorcing spouses is an extremely complex area. Generally, the advice and guidance of an accountant or actuary, in conjunction with a divorce attorney, is useful in resolving the matter.
|
|
The following material concentrates on the requirements that must be met to effectively transfer an interest in an employer-sponsored qualified retirement plan during a divorce. A brief overview of the factors to be considered in fashioning a division is also included.
- How Divorce Courts Split Retirement Plan Assets: Learn how a divorce court values and divides a retirement plan.
- Reaching Retirement Plan Assets During Divorce: Take a look at the next step in this process, examining the requirements of how retirement plan interests and assets can be accessed and transferred.
- Taxation of Retirement Plan Distributions Due to Divorce: Examine the tax implications caused by the transfer of retirement plan assets during a divorce.
© 2024 Wolters Kluwer. All Rights Reserved.