Many couples have spent most of their married lives – often decades – saving for retirement. If a couple decides to divorce after many years of marriage, these retirement accounts are an important issue in the divorce. Most couples want to know – how do we divide our retirement accounts as part of our divorce? It’s a good question, and in a nutshell, the answer is – you treat these accounts the same as you would treat any other type of marital property.
What does this mean, from a practical perspective? In North Carolina, courts attempt to divide marital property according to a theory of equitable distribution. Essentially, this means that a court will look at all of the assets and debts that a couple has as part of the divorce. The court will first determine which portion of the asset – in this case the retirement accounts – is marital, and which portion is separate if any. As a general rule of thumb, if the couple contributed the money into the account during their marriage, it will be considered a marital asset. After determining the nature and value of the account or accounts at issue, the court will then attempt to divide that property as fairly and evenly as possible.
Of course, with respect to dividing any type of property during a divorce, a court will only have to become involved if the parties are not able to resolve the matter on their own. If the parties are able to reach an agreement on how to divide their retirement accounts, they can do so in any way they see fit. In terms of freedom and flexibility, this is always the best option, if it’s possible.
As with any issue in a divorce, depending upon the particular characteristics of the retirement accounts at issue, and the willingness of the parties to work together, it can occasionally become a complicated process. There are any number of retirement accounts and pension plans out there, and it can always be helpful to consult a financial advisor and your attorney as you begin the process of reviewing your accounts and deciding what the best decisions might be as you attempt to divide them evenly. In any divorce-related matter, open communication and cooperation from both parties will be essential in ensuring that the process goes as smoothly and successfully as possible.
The articles in this section are intended to provide helpful general knowledge and information about dividing various types of retirement accounts, and the various options you might have to do so in a way that is best for your family and your future. Of course, the most important first step in any divorce decision-making process should be retaining a knowledgeable and experienced attorney who can help you to truly understand how the law applies to your unique circumstances, and to assist you in exploring your available options. At The Law Office of Dustin McCrary, we’re here to help you do exactly that. Call us at any time.