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Divorce can have long-term financial impacts

On Behalf of | Feb 26, 2019 | Divorce |

When Virginia couples gets divorced, they may need to consider how it will impact their retirement. There are many different types of retirement accounts that may have to be split even if they are in one spouse’s name only. For example, an IRA can be considered marital property, and the same can be true for a pension or other retirement plan such as a 401(k).

If a person has a qualified retirement plan such as a 401(k), it must be split under the terms of a qualified domestic relations order. The QDRO should be drafted by someone who has experience creating them as even minor mistakes can cause frustration in the future. Another item to consider after getting divorced is how it may impact a person’s Social Security benefit.

If a marriage lasted for at least 10 years, it may be possible to obtain Social Security benefits based on the other spouse’s working record. However, individuals can choose to claim benefits on their own work record if that is in their best interest. The other spouse will obtain his or her full benefit regardless of the decision that a person makes. This option is granted automatically and does not need to be written into a divorce settlement.

There are many asset division issues that may arise in a divorce. Therefore, it may be best to go through the settlement process with the help of an attorney. A legal professional may be able to provide advice as to how retirement assets may be divided or how to do so properly.