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Who gets the retirement plan in a divorce?

When a Houston couple is going through a divorce it is a terribly emotional event. It can be hard for a person who is going through a divorce to think about finances, but it's one of the most important aspects of a divorce and a divorce settlement. For many people, retirement accounts are one of their largest assets. In a divorce, it is important to understand who gets the retirement accounts.

There are many different types of retirement accounts and they all can be treated differently in a divorce. A 401K requires a Qualified Domestic Relations Order that divides the retirement account with the ex-spouse. A pension or other employer-sponsored plan each requires a QDRO. If a person has their own retirement account then that will need a transfer incident to move the funds around. The state laws or a prenuptial agreement typically dictate how these assets are divided among spouses.

A person who receives a portion of the retirement settlement can roll the money into their own retirement account, defer taking a distribution until their ex-spouse retires or take a cash payout. There can be tax implications for any of these options.

A legal professional who is skilled in family law can help their client organize their financial affairs to make sure they are prepared for life after a divorce. They can also recommend professionals to help with the financial paperwork, including accountants and investment managers. Although a divorce is often a very emotional event, making sure financial matters are being handled fairly is important. There will be a life after divorce for those who are well-prepared.

Source: time.com, "Who gets retirement accounts in a divorce?," AJ Smith, Nov. 16, 2015If

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Attorney Christine K. Lincoln

Christine K. Lincoln offers sound counsel and legal services to protect clients and their families facing divorce and other family disputes.

She will take the time to understand your individual needs and develop a comprehensive solution to protect your rights and interests.

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