Workplace benefits are among the various forms of income that spouses usually share. If one spouse has better health insurance options than the other, they can both enroll in most cases. Other benefits can also help improve the standard of living for the couple.
Pensions are among the most valuable employment benefits. Professionals ranging from executives and engineers to career military service members may be eligible for pension benefits once they retire. Pensions provide regular income for those who have long worked to support themselves and their families.
It is common for married couples to jointly depend on accumulated pension benefits. However, if they decide to divorce, there may be uncertainty about the future of the pension. People sometimes assume that pensions remain the separate property of one spouse after a divorce.
Can the courts order the division of a pension accrued by one person as part of a property division settlement?
Pensions are often marital property
State statutes govern the distribution of property when couples divorce. Equitable distribution laws grant each spouse a partial interest in pension benefits accumulated during the marriage. That is true for both pensions funded by private employers and pensions earned through military service.
The pension of one spouse can influence the property division process. Its value can play a major role in the overall distribution of assets. The spouses may agree to allow the spouse who accrued the pension to retain it, while the other spouse could request other marital property, such as home equity, to make that retention more fair. The distribution of debts can also influence how spouses address pensions and other high-value assets.
It may be possible to directly divide the pension as well. Appropriate paperwork submitted to a plan manager could split a pension into two accounts in some cases. If dividing the pension isn’t an option, there are other solutions. The spouse receiving the pension could also provide alimony or spousal support to the other spouse for the duration of their pension.
There are numerous ways for people to address high-value resources in divorce fairly. Reviewing one’s marital estate with the lawyer can help people prepare for the complexities of a high-asset divorce. Spouses who understand their rights and the basics of state law can request appropriate property division terms from the courts when they divorce.
