The division of retirement accounts in divorce
Retirement accounts and other employment benefit programs are crucial components of long-term financial stability, and can contribute significantly to one’s net worth. As a result, retirement accounts are also often a major factor in property division cases. Understanding how personal retirement accounts are regarded under Utah state law can help people ensure that their own retirement savings, as well as the savings of their husband or wife, are accounted for appropriately in divorce proceedings.
The Utah Courts system explains that funds paid into personal retirement accounts during the time of the marriage are considered marital property. Accounts that may be subject to division as marital property can include but are not limited to:
- 401(k) plans
- Military retirement benefits
- IRA accounts
- Government pension plans
Despite the fact that the retirement accounts of both spouses can be considered marital property, the Utah courts generally base property division decisions on the belief that people should be entitled to receive the full amount of their own retirement savings in most cases. Consequently, other forms of property are often used to compensate one spouse for the other’s retirement savings.
In the event that retirement accounts are distributed in property division, wiserwomen.org notes that there are several options for dividing funds equitably. If one spouse has a higher value of retirement savings than the other, for instance, the two amounts can be combined and then divided in half. People also have the option of establishing a qualified domestic relations order to account for retirement plans in their divorce settlement.