Dividing Retirement Accounts in a Georgia Divorce

Dividing-Retirement-AccountsWhen a couple has reached the point in their marriage that divorce seems to be the only option, it is a very stressful time. One of the hardest parts of a divorce is the fact that one household becomes two, which means that there are economic strains on both individuals who are looking at how they can support themselves and their loved ones. The availability of retirement assets in the future becomes a very significant point of contention during a divorce, especially if one spouse contributed to the accounts because of the support received from a non-working spouse.

Georgia is an equitable distribution state, which means that property accumulated during the marriage is going to be fairly split between the parties at the time of the divorce. This does not mean that it is an equal, down-the-middle type of split. There are many factors that are considered in determining who deserves what, including the ability of each spouse to move forward and earn enough income to support him or herself in the future. If the parties are unable to agree on a split of property, the court will consider the following:

  • The age of the parties;
  • Whether health concerns limit one person’s ability to earn a living after the divorce;
  • The relative educational and employment backgrounds of the parties;
  • Whether one party has the primary responsibility of caring for minor children;
  • Whether one party sacrificed his or her career to support the career of a spouse; and
  • Other factors that would facilitate or impede a person’s ability to earn a living and contribute to a retirement account.

The analysis applies to retirement accounts as well as other types of marital property. If the contributions to a retirement account or pension were made during the course of a marriage, then these funds are subject to an equitable distribution during a divorce. If the parties cannot agree on how these funds will be divided among the spouses, then the court will step in and address retirement funds as part of the overall division of property. There are times when a judge will look at the respective positions of the parties and determine that the spouse who earned the retirement asset may keep it in its entirety. This generally is done when the other spouse is deemed to be in a strong position to go out and accumulate sufficient retirement assets for his or her needs without the benefit of those earned by his or her spouse during the marriage.

Qualified Domestic Relations Order (QDRO)

Retirement assets are treated a little differently than other assets because the payout of the funds may be far in the future. Although it is possible for there to be a valuation of the retirement assets and a distribution of non-retirement property that reflects the fact that one party will keep the retirement benefits, in many cases, there is a qualified domestic relations order (QDRO) that is drafted and submitted to the appropriate party to split the payout of the retirement funds. The QDRO must satisfy the specific requirements of the account at issue, but basically it serves to instruct the entity that will be making retirement payments, through a plan administrator, how to divide the payments between the employee who contributed to his or her account or otherwise earned the retirement benefits and a former spouse who is entitled to a calculated share. This order typically is completed within a short time of the finalization of a divorce in accordance with the settlement or court determination relating to the distribution of property.

Charlton & Glover Advocate for Those Going Through a Divorce

A divorce has financial and emotional repercussions for the individuals going through the process, even under the most amicable of circumstances. If you are contemplating divorce in the Roswell or Alpharetta area, contact the experienced divorce attorneys at Charlton & Glover. Call us at (770) 993-1005 to schedule a free initial consultation.

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