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What happens to retirement accounts in a divorce

On Behalf of | May 17, 2023 | Division Of Assets, Divorce

Divorce has financial, emotional and mental impacts on the separating couple and their families. The financial consequences can be significant for those who are more established.

Therefore, you should understand what can happen to your retirement during a divorce.

Equitable distribution

Oklahoma is no longer a community property state, where the court divides your marital assets in half. Instead, it is an equitable distribution state. In this case, the judge divides your assets equitably, but this is not always equal. In most cases, a judge will accept how you and your former spouse agree to divide your retirement and other assets, but if you cannot come to an agreement, the judge will intervene.

Your marriage’s longevity, spousal contribution, income sources, earning potential and economic status of each party. Your spouse’s retirement contributions and earnings can also counterbalance your own, and if they are close, you may keep your entire account without negotiation.

Separate versus marital property

Separate property is anything you had before you got married. This includes existing retirement accounts and contributions. However, anything you contribute and any dividends or other earnings you receive during your marriage are marital property. Marital property is the only type subject to division.

Retirement protection strategies

You really have a significant influence over your retirement account protection. You can check with the institution holding the account to determine whether it can provide dual distribution upon retirement, one check to you and one to your spouse. You can make your ex a beneficiary on the account or other insurance policies of equal value. You may also negotiate for other assets so you can keep your retirement intact.

Yes, a judge could divide your retirement account between you and your former spouse. However, strong records and a willingness to negotiate could save your funds.