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How Your Retirement Assets are Impacted by Divorce

Published September 9, 2020
As you begin the divorce process, it’s important to take a look at how retirement benefits will be divided between you and your ex. Make sure you take all the necessary steps to exert your right to receive your share of your spouse’s retirement assets by working with a knowledgeable divorce attorney.

If you are facing the end of your marriage, you likely have several questions about what to expect. Suddenly, you are faced with an array of important decisions that will shape the course of your future. From financial concerns to finding new housing, to determine which parent will assume custody of your children, it’s understandable if you are feeling overwhelmed by all these choices. One aspect of divorce that you may not have thought about is how any retirement plan assets will be divided up during the process. Retirement benefits can be significant, so it’s helpful to take a look at how divorce courts in Oregon deal with the division of retirement assets.

Consider a Qualified Domestic Relations Order (QDRO)

If your ex was the main source of income during your marriage, it’s natural to have concerns about whether you’ll still be entitled to receive your share of their retirement account after the divorce is finalized. You may wonder if your ex’s employer could just deny you access to the funds, or somehow paying out the benefits to your ex and leaving you with nothing. Fortunately, by putting a Qualified Domestic Relations Order (QDRO, or “quad row”) in place, you will be able to protect many of your rights to child support, alimony, or property rights in the case of divorce. The QDRO can also provide clear instructions to your ex’s retirement plan as to how they can ensure that you receive your share of the retirement benefits.

However, a QDRO can only be used for pension plans that are IRS tax-qualified and protected under the Employee Retirement Income Security Act (ERISA). Military or government pensions are governed by different laws, so a QDRO does not apply. If you think a QDRO could be useful, talk to your divorce attorney or other financial advisors about how to draft and submit the QDRO paperwork.

Planning for a Brighter Future

Once you’ve taken steps to ensure that you receive the retirement benefits that you are depending on, you may be curious about how the funds will be divided and transferred to you. Depending on the retirement plan, you may receive a one-time large sum (either now or in the distant future), or you may receive smaller recurring payments that are slowly released over a longer period of time. It can also become a bit tricky to distinguish between funds in the retirement account, as most states allow you to only have access to marital property or funds that grew over the duration of the marriage. If your spouse had a retirement account long before you married, this amount would likely be considered as separate property, meaning that you would only be entitled to receive those benefits that were accrued while you were legally married.

As you plan for your new financial reality post-divorce, it’s important to anticipate what your assets will be. Working with a knowledgeable divorce attorney is key to making sure that you receive clear and accurate answers to your questions. The trusted and friendly legal team at Lee Tyler Family Law, P.C. is here to help you understand your divorce options while making sure that you have the tools you need to begin the next chapter of your life.


Call us today at (503) 233-8868 to schedule a consultation with a dedicated divorce and family law attorney.

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