Getting a divorce often means that there will be property division taking place. If you are part of the growing population of older adults getting a divorce, you may have more at stake than property and a bank account or two. What happens to your retirement account when you get a divorce?
The retirement account that you have can be very complicated when trying to disburse it through the court in a divorce situation. It represents a big chunk of your livelihood and is very important to you.
There may be two retirement accounts involved for both of you. They will both be examined by the court in Florida and will be disbursed however the judge sees fit. If you came into the marriage with a 401k or an IRA already intact, the court will treat that amount as separate property and it will remain yours.
Documentation is vital and having an attorney by your side who knows the particulars of the laws of the state of Florida is also very important.
There are two types of divisions that can take place and one of them is called the Qualified Domestic Relations Order.
If you have a pension plan or 401k, the judge will label it as a QDRO and it will be disbursed as such. A QDRO allows the funds in the account to be separated and withdrawn without penalty and can be deposited in the non-employee spouse's retirement account, which is usually an IRA.
Being aware that you have rights under the law is imperative. Getting a lawyer involved who is sure of what he or she is doing can be empowering. You need someone who has vast experience in dealing with QDROs and can use the law to your advantage.
Source: Forbes, "How Divorcing Women Should Handle Retirement Accounts And Pension Plans," Jeff Landers, accessed May. 22, 2015