We appreciate that divorce can be complicated. Even where parties agree on all the issues it can be important to speak with a family law attorney regarding some of the more “hidden” aspects of divorce. Many clients have a firm grasp and understanding of their personal property; one person gets grandma's ring, the other the dinnerware or TV. But when it comes to dividing financial assets it can be easy for the average client to feel a little bit lost without a helping hand to guide them through.
Retirement Benefits: Next to a house, many couples most important asset can be their retirement account, and dividing these up is not as simple as taking half. Retirement benefits could also vest in a number of ways, like through stock options or pension plans which both have different ways of being calculated. Cashing out a retirement plan could have important tax consequences that need to be taken into account when valuing the asset. Even where it may be technically possible, you may need a QRDO, or qualified domestic relations order before moving forward.
Health Insurance: Often courts will require health care for any minor parties, and if retirement is in your future you will need to consider the consequences of health insurance and retirement as well. Does your health insurance continue? Will you need to apply for private insurance when you leave your job?
Tax Implications: Even where benefits seem simple it is important to understand the tax consequences and include these in any property divisions. For example, that 401k is suddenly going to lose a lot of value if it ends up being cashed out early, and you won't want to wait until tax time for this surprise.
For any questions or concerns regarding retirement and divorce please contact Elise Buie Family Law Group, PLLC for a free consultation.