One of the primary benefits of working is that you’ll save for your retirement! After all, almost everyone longs for the days when they can relax without having to work if they don’t want to. However, when you and your spouse divorce, your retirement benefits may be at risk. Keep reading to learn what happens to these funds during the dissolution of your marriage and how Los Angeles divorce attorneys can help you protect your finances.
Is My Spouse Entitled to My Retirement Benefits?
Before exploring how California distributes property among divorcing spouses, it’s essential to understand that there are a few different retirement benefits that may be impacted when a couple decides to separate. This includes Individual Retirement Accounts (IRAs), 401ks, pensions, and social security benefits.
In California, spouses are entitled under community property laws to split marital property equally. Unlike other states that follow equitable distribution laws, which separate property based on each partner’s financial contribution to the marriage, community property splits anything either spouse accrues during the marriage, with exceptions.
It is important to note that to access, divide, and distribute a 401k, your spouse will need a Qualified Domestic Relations Order (QDRO). This allows your spouse to receive a portion of the money and place it into a separate retirement account without incurring exuberant taxes.
However, they will be able to access the other funds. For example, if you have an IRA account before getting married with $20,000 in it, and over the course of your marriage you accrue another $40,000, only the funds gained during the duration of your marriage are subject to distribution. The funds in the account before you and your spouse were married are considered separate property.
Should I Contact an Attorney?
When your retirement benefits are at risk during a divorce, ensuring you contact an experienced divorce attorney can help protect your finances.
Though there may not seem like much can be done to protect assets in a state that guarantees half to spouses, you may be able to work with your attorney to negotiate and propose other assets in exchange for keeping your retirement account. For example, you may be able to offer your spouse the property you shared to retain your benefits.
When going through a divorce, even if it is seemingly amicable, the best option is to contact a divorce lawyer once you are aware that the dissolution of your marriage is occurring. At the Zitser Family Law Group, we have the experience necessary to help you navigate the complexities of divorce. Contact our legal team today to connect with a competent attorney and discuss the details of your case.