How Can I Prevent My Divorce From Affecting My Retirement Plans?

 Posted on April 21,2021 in Divorce

One of the most valuable assets in many divorces is retirement accounts. In many cases, these accounts can be worth tens of thousands, if not hundreds of thousands of dollars, making them a point of contention for some spouses, especially those who are close to retirement. The process of going through a divorce can be difficult emotionally, but it can also be hard on the wallet, too. For couples who are over the age of 50 or who are nearing divorce, your retirement plans can be of particular importance when it comes to how your divorce will affect your finances. In most cases, there are things that you can do to protect your retirement plans from being compromised.

Protecting Your Retirement Plans During Divorce

There are many decisions that you must make during your divorce. Many of these decisions have the capacity to alter your plans that you may already have in place for your retirement, which is why it is extremely important to give all of your decisions careful consideration during your divorce. Here are a few things you can do to protect your retirement plans:

• Try to negotiate during the asset division process with other assets. The most preferable option for protecting your retirement plans is by leaving your retirement accounts untouched. If your spouse believes that he or she is entitled to a portion of your retirement savings, you should try to negotiate that amount with other assets before you agree to relinquish that amount. For example, your spouse may settle for taking the car or other physical assets instead of their portion of your retirement account.

• Delay your retirement date. Even if you and your spouse agree on everything, getting a divorce is not cheap. If your savings dwindle because of your divorce, you may find that you can no longer afford the kind of life you were planning for after you retire. If you are unable to prevent your spouse from claiming a portion of your retirement funds, you may find that you need to delay your retirement date until you can refund your savings and comfortably retire.

• Increase your monthly retirement account contributions. If the thought of delaying your retirement date is not appealing to you, you may want to consider making larger contributions to your retirement account while you are still working. If you make larger contributions, you should still hit your target amount by your target retirement date, even if you lose a little.

Our Geneva, IL Divorce Lawyer is Here For You

For many older adults who are contemplating divorce, retirement is often a topic of concern and for good reason. Saving for retirement is not easy and the last thing you would want is for all of your plans to collapse because of your divorce. At the Law Office of Matthew M. Williams, P.C., we will make sure you understand all of the options available to you during your asset division process, especially when it comes to your retirement assets. To schedule a consultation with our Kane County divorce attorney, call our office today at 630-409-8184.

Sources:

https://www.businessinsider.com/how-to-keep-your-retirement-savings-in-a-divorce-2016-11

https://www.investopedia.com/articles/investing/072915/how-protect-your-retirement-after-divorce.asp

https://smartasset.com/retirement/ways-to-protect-your-retirement-savings-after-divorce#:~:text=According%20to%20most%20state%20laws,and%20earned%20before%20the%20marriage.