Both you and your soon-to-be ex-spouse likely have your own priorities when it comes to settling divorce matters. It is common for divorcing individuals to fight for ownership of the family home or business, but you should also consider how you might keep your retirement accounts intact.
Depending on your unique circumstances, a divorce can significantly disrupt your retirement plans. By understanding how divorce proceedings affect retirement assets and your options for protecting them, you can confidently strive for an enjoyable quality of life even after your divorce.
Understand how property division affects retirement assets
Any contributions made to a retirement account while married are community property owned by both yourself and your spouse. This means that those contributions are subject to standard property division procedures during your divorce. While this can be negligible if you and your spouse make similar contributions, you can find yourself with significantly fewer retirement savings after the divorce if your spouse sets aside little or no money for retirement.
Negotiate an agreement with your spouse
The best way to secure your retirement accounts is by entering a Virginia marital agreement with your spouse. If you do not already have a prenuptial agreement in place, you can still create a postnuptial agreement that allows each party to advocate for their own priorities in the event of divorce.
Keep in mind that any contributions you make to your retirement accounts before marriage are individual property. Even so, a large amount of retirement savings that you set aside during a long marriage can become your soon-to-be ex-spouse’s property instead if you do not take steps to protect those accounts.