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Retirement assets and divorce settlements

On Behalf of | Apr 15, 2022 | Divorce |

Financial concerns remain on many people’s minds looking at their retirement years. Spouses planning to divorce might worry about preserving their retirement savings, especially if their retirement years soon approach. Both spouses are likely to focus on the division of retirement accounts as a critical part of divorce negotiations in Washington.

Retirement accounts and divorce negotiations

Those who haven’t researched the rules associated with retirement asset divisions in divorce proceedings may need to familiarize themselves with them. The rules of certain accounts, such as a government thrift savings plan, may require specific language in the divorce decree for an ex-spouse to receive any awarded amount.

Other retirement-related divorce issues, including the need for a qualified domestic relations order to handle 401k divisions, might factor into settlement negotiations. Persons who intend to rely on their pensions during retirement years may not realize the pension could be subject to equitable distribution.

Planning post-divorce life

Divorce settlement negotiations could consider future living expenses. A single life centered on one income and multiple new expenses may become costly. Effective budgeting alone might not be enough, so one spouse could seek a reasonable settlement and a fair request for spousal support.

Laws associated with Social Security place these benefits on the table during divorces. Not every ex-spouse becomes eligible to receive a partner’s benefits, though. Rules, such as the marriage lasting ten years, guide the family court’s decision-making authority. That said, many spouses might not realize they meet the requirements to request a portion of social security benefits.

Those planning on remarrying may wish to be more proactive about protecting remaining retirement funds. A prenuptial agreement could help someone protect assets if the subsequent marriage doesn’t work out.