When couples decide to dissolve their marriage, they often dispute what is fair in regard to property division and what is reasonable with respect to spousal support. For this reason, Connecticut couples thinking about divorce might be interested in ways to obtain a favorable divorce settlement as recommended by authorities on the matter.
Authorities state that divorcing partners should focus on retirement assets above all, including Social Security benefits or 401(k) plans. The name on a retirement account is often irrelevant when it comes to divorce. For the most part, retirement assets that were procured during marriage, including funds deposited into an IRA, are considered marital property. Reportedly, spouses have the right to seek a fair share of those assets. Only those retirement assets possessed by a partner before entering into marriage are off limits when it comes to negotiating property division, authorities say.
Not all retirement accounts are equally desirable, though. For example, since a Roth 401(k) or a Roth IRA has already been taxed, seeking a share of those accounts will result in more money for an ex-spouse.
Because retirement accounts are not static but tend to grow with time, authorities say that seeking an ex's retirement assets is smarter than seeking cash. Moreover, since a home can lose value and alimony is subject to taxes, authorities recommend focusing on retirement assets during the property-division process of a marital dissolution.
Because that property-division process can be complicated and highly contentious, many divorcing partners retain the counsel and resources of a family law attorney. In this way, partners going through a divorce may have an advocate who is familiar with the complex nature of valuing assets and arranging for their division.
Source: Forbes, "The Big Money Mistake Divorcing Women Make", Kerry Hannon, July 03, 2014