In Virginia, the courts try to divide divorcing couples’ property in a way that is fair or “equitable.” This approach to property division can have a significant impact on your retirement savings, especially at the end of a longer marriage. How will Virginia property division effect your retirement savings?
A prenuptial or postnuptial agreement can protect your savings.
Some couples address their retirement savings early through a prenuptial or postnuptial agreement. These agreements can specify that each spouse is the sole owner of their retirement accounts, meaning that these accounts will avoid the property division process.
What happens when the court divides retirement savings?
Unless you have a prenuptial or postnuptial agreement in place, the contributions you made to your retirement accounts during your marriage will be subject to property division. This can mean that the court divides your retirement savings, or it can involve trading other assets in exchange for keeping your retirement savings intact. The court may also address other benefits during a divorce, including military pensions.
Generally, a Qualified Domestic Relations Order (QDRO) will define the division of retirement accounts and pension plans. Unlike withdrawing from a retirement account under other circumstances, a QDRO allows you and your spouse to avoid penalties when dividing your savings. This order will also define how and when payments from pension plans will be made.
If you wonder how you can protect your retirement savings and ensure your financial health after your divorce, speaking to an experienced family law attorney could help. They can discuss your goals and create a legal strategy that protects your savings during property division.