Can I Keep My Pension in a Divorce?December 7, 2020
Pensions are important, and the person receiving the pension is guaranteed a certain amount of money as a lump amount or monthly sum during retirement. If the person is married, the spouse may be entitled to receive a percentage of the pension, even after the death of the recipient. However, the recipient never has to put any money into the pension, instead, the money is set aside by the employer.
What happens if the pension recipient gets a divorce? This situation is complex, and many divorcing spouses have pension-related questions. In most states, pensions are considered joint marital property as long as all or some of the pension started during the marriage. Therefore, the full amount of the pension is considered an asset to be divided between the divorcing spouses. Dealing with the division of retirement accounts is not cut-and-dry; in some circumstances, a spouse may not be entitled to a pension after divorce.
Exceptions to Splitting a Pension Between a Divorced Couple
During divorce proceedings involving a pension, a lawyer will want to know when a pension was first earned. For instance, if the pension happened prior to the marriage, it pre-dates the marriage. Consequently, the divorcing spouse would likely not be eligible to keep the part of the pension that existed outside of the marriage. Similarly, if a couple entered into a pre-nuptial arrangement that included the recipient’s pension, the divorcing spouse would not be able to access the pension.
It should be noted that divorcing spouses with pensions should never try to hide this type of asset. Concealing assets during divorce proceedings is always wrong. Showing all assets makes it easier for lawyers and other professionals to determine what is fair for both parties.
Is It Possible to Keep All of the Pension?
Since a pension is considered an asset like all other marital assets, it can be used as a bargaining tool during a divorce. If the pension is worth $250,000 and the marital home is also worth $250,000, the pension recipient could relinquish part ownership of the house to establish a fair trade. Offering this type of trade could be an acceptable way to split assets without touching the pension.
Will a Spouse Automatically Receive Their Ex-Partner’s Pension in a Divorce?
If a spouse is entitled to part of an ex-spouse’s private pension after divorce, the spouse must file a Qualified Domestic Relations Order (QDRO) through the court. The QDRO initiates movement of the pension money, either into a retirement account to be dispersed later, or as a lump sum into one account to be available right away. Without a QDRO, the spouse cannot touch the pension money, even though it was agreed to in the divorce plan.
Are Military Pensions Different?
The law governing military pensions follows similar rules to other types of pensions. However, military pensions can be treated a bit differently federally and in each state. For this reason, divorcing military spouses should hire a lawyer who is well-versed in pensions.
Media Divorce Lawyers at the Law Office of Deborah M. Truscello Assist Divorcing Couples with Pension-Related Questions
Are you planning to get divorced? If you have pension-related concerns, talk with one of our Media divorce lawyers at the Law Office of Deborah M. Truscello. Contact us online or call us at 610-892-4940 for a free consultation. Located in Media, Pennsylvania, we serve clients throughout Bucks County, Chester County, Delaware County, Lancaster, Montgomery County, Norristown, Philadelphia, Reading, and West Chester.