While few people feel exuberant during a divorce, most feel flat out exhausted. The divorce process is far from a simple walk in the park, especially when property division is involved. Along with the many other assets obtained throughout a marriage, Maryland couples should also include any retirement plans during the division process.
One of the most valuable assets an individual can own is a retirement savings plan, and unless a prenuptial agreement states otherwise, an ex-spouse may be entitled to part of the balance. It may be wise to obtain a Qualified Domestic Relations Order to protect your interest and provide instruction as to how the pension plan will be paid out. A QDRO is obtained through a court order and provides needed protection that a marital settlement agreement does not provide with respect to possible taxes and penalties.
With this large asset comes many potential obstacles, such as payout options. Some plans may offer an immediate lump sum payout while others send out payments periodically. Payouts are usually dependent on the retirement plan. It is recommended that spouses reread the summary and description of their retirement plans along with other any other documents related to the plan.
The bottom line is that divorce can be pricey. Along with possible effects to your financial security, an individual’s emotional health can be at risk. To deal with these effects, Maryland residents should consider retaining an experienced attorney to not only protect their rights, but to also provide guidance on the appropriate legal steps and options available throughout the property division process.
Source: thebalance.com, “How Retirement Plan Assets are Divided in a Divorce,” Deborah Fowles, accessed on Jan. 3, 2018