What Are Divorce Pension Rights?
Divorce means big life changes, especially when it comes to finances. These changes can be more extreme and more important for those approaching or already in retirement. Retirement savings are often one of the largest assets that couples have when facing divorce and must be divided fairly and in accordance with the law. When dividing up assets in divorce it’s important to make sure that you understand your divorce pension rights in order to ensure that you receive your fair share. You’ve spent your life working and saving for retirement, don’t let your marital woes jeopardize your financial security in retirement. A family law expert in NJ may be able to help you secure your pension and other retirement savings during matrimonial disputes.
Pensions are Marital Property
When facing divorce and the inevitable financial divisions and arguments, it’s important to understand that there are two types of properties, individual and marital. Individual properties are usually defined by prenuptial agreements and generally aren’t part of divorce settlements while marital properties are everything that was gained by either party during the marriage. These assets make up the bulk of what most couples own and will be split in the divorce settlement. The important thing to remember is that pensions are considered marital property and will therefore be part of the divorce settlement.
There are a number of things to keep in mind regarding pensions during divorce settlements. You are entitled to a portion of your spouse’s pension and how much you receive will be determined as part of your court settlement. Keep in mind that your spouse may have more than one pension as a result of various work situations throughout his or her life. You may be entitled to a portion of each of these pensions as determined by the court. You may need to hire an accountant or actuary to help determine the value of your spouse’s pension. Without an accurate valuation, it will be very difficult to receive your fair share. Remember; in these proceedings it’s generally wise to hire experienced professionals to help guide you through.
Once the amount of money you will be receiving from the settlement has been determined it’s important to understand how you will receive the payments. You may receive them directly from the pension as part of a Qualified Domestic Relations Order or QDRO. With the help of your attorney make sure that your settlement plan states exactly how much each payment should be as well as when the payments are to begin and when they are to stop. It’s important to get these fundamental details written in the court order so they are legal binding. Don’t leave your future financial security up to the goodwill of your ex!
Timing is everything!
It’s important to make sure that your share of the pension is defined at the time of the divorce. In addition to the peace of mind that you’ll have knowing that your future is financially sound, it is often very difficult to split up pensions after the divorce is finalized. You may want to use your rights to your spouse’s pension as leverage during the settlement. You are allowed to trade your rights to your spouse’s pension for other assets in the settlement. For instance, you may want to use your share of the pension to keep the house or other properties. It’s also wise to settle these pension disputes at the time of the divorce settlement because your former spouse’s situation may change in the future. He or she may lose all of his or her money or remarry or even die. All of these possibilities might affect your ability to claim what is rightfully yours.
The rules regarding the division of pensions are complicated and change from state to state as well as from plan to plan. Some types of retirement income are not eligible to be split such as social security. There are many different types of retirement plans and some are regulated by different sets of rules. Military and government pensions in particular can be tricky to split as they are not typically governed by the same rules as a 401 (K) or other traditional pension plans. It’s always wise to hire qualified and experienced professionals to help sort out your rights. An experienced team of attorneys, actuaries, and accountants can help to ensure that your financial future is on solid ground.
Pensions are Marital Property
When facing divorce and the inevitable financial divisions and arguments, it’s important to understand that there are two types of properties, individual and marital. Individual properties are usually defined by prenuptial agreements and generally aren’t part of divorce settlements while marital properties are everything that was gained by either party during the marriage. These assets make up the bulk of what most couples own and will be split in the divorce settlement. The important thing to remember is that pensions are considered marital property and will therefore be part of the divorce settlement.
There are a number of things to keep in mind regarding pensions during divorce settlements. You are entitled to a portion of your spouse’s pension and how much you receive will be determined as part of your court settlement. Keep in mind that your spouse may have more than one pension as a result of various work situations throughout his or her life. You may be entitled to a portion of each of these pensions as determined by the court. You may need to hire an accountant or actuary to help determine the value of your spouse’s pension. Without an accurate valuation, it will be very difficult to receive your fair share. Remember; in these proceedings it’s generally wise to hire experienced professionals to help guide you through.
Once the amount of money you will be receiving from the settlement has been determined it’s important to understand how you will receive the payments. You may receive them directly from the pension as part of a Qualified Domestic Relations Order or QDRO. With the help of your attorney make sure that your settlement plan states exactly how much each payment should be as well as when the payments are to begin and when they are to stop. It’s important to get these fundamental details written in the court order so they are legal binding. Don’t leave your future financial security up to the goodwill of your ex!
Timing is everything!
It’s important to make sure that your share of the pension is defined at the time of the divorce. In addition to the peace of mind that you’ll have knowing that your future is financially sound, it is often very difficult to split up pensions after the divorce is finalized. You may want to use your rights to your spouse’s pension as leverage during the settlement. You are allowed to trade your rights to your spouse’s pension for other assets in the settlement. For instance, you may want to use your share of the pension to keep the house or other properties. It’s also wise to settle these pension disputes at the time of the divorce settlement because your former spouse’s situation may change in the future. He or she may lose all of his or her money or remarry or even die. All of these possibilities might affect your ability to claim what is rightfully yours.
The rules regarding the division of pensions are complicated and change from state to state as well as from plan to plan. Some types of retirement income are not eligible to be split such as social security. There are many different types of retirement plans and some are regulated by different sets of rules. Military and government pensions in particular can be tricky to split as they are not typically governed by the same rules as a 401 (K) or other traditional pension plans. It’s always wise to hire qualified and experienced professionals to help sort out your rights. An experienced team of attorneys, actuaries, and accountants can help to ensure that your financial future is on solid ground.