Ready to Retire? Ready to Divorce? What about your Retirement Assets?
- 26 January 2021
- 0 Comments
In recent years we have seen a significant uptick in divorces among couples in their 50s, 60s and beyond. When we are contacted by a potential client in this wide, but significant age group, one of the first things we do is try to ensure that this is not a “snap” decision, and confirm that it has been thought out. I mean, let’s face it, if someone has lived, loved and tolerated another person for 30+ years, why not a few more?
But if the client simply cannot continue with the marriage, the next area we try to explore with a client is what impact this “later-in-life” decision will have on their retirement. While it is unlikely that a divorce later in life will be consumed with issues such as timesharing and child support, about 62% of couples 50 and older fight about retirement savings in the process of reaching a settlement. And I can’t say I blame them. Nobody intends to put in a lifetime of work, accumulate a substantial sum for their retirement with the intention of giving half away to someone they do not intend to enjoy their days of retirement with. Suddenly, each spouse has to think about their own future and how dividing their retirement savings and other assets will affect their plans. Unfortunately, when it comes to divorce that is the reality. And when it comes to high net worth divorces, the stakes are even greater.
Courts in Florida, as an equitable distribution state, are required to divide marital property just and fairly. The starting point is to divide property equally, but the end result is not always equal.
Retirement money may go entirely to one spouse or it may be divided between them. This depends on a variety of factors, including whether the retirement account was set up prior to the wedding or after, or whether the other spouse received other assets as a setoff to the retirement monies. Ultimately, a retirement plan that was set up for one lifestyle may now have to support two. This might require people to put off retirement until they build their savings back up or downsize their retirement plans. However, when you hire a knowledgeable divorce and marital attorney, your attorney may be able to craft creative solutions to soften the blow and allow parties to proceed with retirement plans.
At the Law Offices of Cindy S. Vova, P.A. it is our goal to ensure our clients do not sacrifice retirement security just because they decided to divorce later in life. After all, YOU earned it, not your spouse.