Thinking about your future can motivate you to file for divorce. The idea of spending the rest of your life with someone who makes you miserable can push you to change your circumstances and pursue your own happiness.
However, the expenses involved in divorce and your financial reliance on your spouse may make you worry about your future. Especially if you are close to or even already past the age of retirement, divorce can seem like a risky undertaking for your future financial stability.
You probably share whatever retirement savings or pension you expect to rely on with your spouse. What will happen to those accounts when you file?
Retirement accounts and pensions are often subject to division
Unless you have a prenuptial or postnuptial agreement with your spouse, there can be a lot of uncertainty about the specifics of an upcoming divorce. If a judge has to set the terms for a contested divorce filing, they review your family situation and apply Illinois’ equitable distribution statute to your family’s circumstances.
Generally speaking, the wages and other income you earn, as well as any property you purchased, is marital property that the courts might divide. Assets set aside in a marital agreement, received through an inheritance or as gifts and property owned prior to marriage may be exempt from division.
Retirement accounts and pensions may be partially separate property and partially marital property, especially if one spouse started the account before the marriage. The amount accrued during marriage, however, will typically get split.
It can be hard to predict what a judge sees as fair
When dividing your pension, retirement account and other major assets, an Illinois family law judge should focus on what is fair. It can be nearly impossible to predict what they will decide is fair, but that often includes giving each spouse a portion of the retirement account or pension.
Thankfully, if done in accordance with a Qualified Domestic Relations Order (QDRO) approved by the judge, you won’t incur any penalties for splitting your pension or retirement savings. While you may have less in the account after your divorce, you will also have your freedom and the ability to decide how you want to structure your golden years.