Will I Lose My Retirement in Divorce?

Will I Lose My Retirement in Divorce?

February 27, 2023

Getting divorced in Indiana or any other equitable distribution state can be complex, especially when deciding how to divide retirement or pension plan benefits. Some crucial factors and considerations must be considered, including examining each spouse’s contributions during marriage and their financial prospects after the divorce. Spouses should also consider any other assets involved, such as inheritance rights, if applicable. It is essential to understand that while many states will have a 50/50 split on marital assets as the baseline, in an equitable distribution state like Indiana, trial court judges may have some latitude in making this decision. 

With these decisions often having potentially life-altering consequences for both spouses involved, it is critical for anyone going through a divorce in an equitable distribution state to consult with a lawyer specializing in family law and understand the nuances of working with retirement plans. The following blog will explore pension and retirement rights while exploring key factors for individuals to consider. 

How much pension or retirement is a spouse eligible to receive?

 Pension and retirement accounts are often complicated when dividing assets into a divorce. In Indiana, the presumptive standard for division is 50/50. Still, a judge presiding over the divorce can deviate from that presumption in certain circumstances, such as when one spouse (particularly a stay-at-home parent) may not have worked outside the home to care for children during the marriage. 

Due to the complexity of federal regulations and codes, hiring a lawyer to navigate the complicated nature of retirement funds and asset division is critical. For example, The Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code of 1986 are both considered in court to ensure retirement assets remain compliant and fair. In contentious or complex property and asset division cases, Federal Law takes precedence. A qualified lawyer can assist you through understanding the federal acts, codes, and Indiana state considerations during your divorce. 

Are there alternatives to splitting a retirement fund or pension?

Sometimes, splitting retirement assets may be the only feasible solution, but there are better choices than dividing retirement assets. Alternatives such as keeping your own retirement funds or negotiating a trade to exchange assets of equal value are often better for both spouses. For example, if you and your spouse each have approximately the same retirement savings, it makes more sense to leave things the way they are instead of cutting both accounts down the middle (so long as an even 50/50 split is reasonable). 

Similarly, if you have other substantial marital assets – such as real estate holdings or non-retirement investments – trading those for your spouse’s share of the retirement savings can be a viable option. When determining how to divide financial assets during a divorce settlement, many creative solutions can work out in everyone’s favor.

Questions? Contact The Bellinger Law Group.

Divorce and asset division are stressful processes that can become overwhelming. Having experienced legal help on your side is essential during this challenging time. The Bellinger Law Office offers the skilled representation you need for the best possible outcome in your divorce case. 

Our team will work hard to protect your rights and advocate for a resolution that meets your unique needs. Don’t wait – contact The Bellinger Law Office to schedule a consultation today.

Guidance for Families


Meet Attorney

Robert H. Bellinger



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