Your Rights to Retirement Assets

If you’re contemplating divorce or are already in the middle of divorce proceedings in Florida, you may be wondering what happens to your retirement in divorce. Is your 401(k) subject to equitable distribution with your spouse just like other property you have acquired together? After all, it is money that you alone have saved and are going to need when you decide to retire.

The answer is mostly yes — the earned income you have stashed away for retirement since marriage is considered marital property and may be subject to division upon divorce. The reason we say “mostly” yes is if the money saved was from income earned during your marriage - not before or after.  However, Florida law and caselaw include a range of other factors that are also onsidered when dividing marital assets, including retirement accounts.  So, each asset may not end up being divided 50/50.

If you’re contemplating divorce or have been served divorce papers in Tallahassee or anywhere in North Florida, contact the family law attorneys at Fournier Law, PLLC. We would be proud to represent your best interests when it comes to the division of assets during divorce. Every case is different and the results achieved can be contingent on a variety of different factors.  At Fournier Law, we will fight tirelessly to protect your fair share and preserve the future you have built for yourself.

Equitable Distribution
Under Florida Law

When you go to court to dissolve a marriage and you and your spouse have not entered into a settlement agreement, the judge will attempt to equitably distribute all marital property and debts — dividing up anything acquired by either spouse during the marriage. The principle of equitable distribution starts with a 50-50 split, but other factors can point toward a less equal allocation.

Florida appeal court decisions confirmed the potential for unequal distribution in a case called Foley v. Foley, which stated that, “equitable distribution of a marital asset should be equal, unless legally sufficient justification for an unequal distribution is given based on the relevant statutory factors.” 19 So.3d 1031, 1032 (Fla. 5th DCA 2009); see also, King v. King, 273 So.3d 233 (Fla. 2d DCA 2019).  Florida Statute 61.075 lists some of these relevant statutory factors, including:

  • Contributions to the marriage by each spouse
  • Economic circumstances of the two parties
  • The duration of the marriage
  • Any interruption of personal careers or time off for educational opportunities
  • The contribution of one spouse to the other spouse for career or educational opportunities
  • Wrongful conduct by either spouse during the marriage
  • The desirability of retaining an asset, including interest in a business, corporation or professional practice, free from a claim or interference from the other spouse
  • The desirability of retaining the marital home for the sake of dependent children
  • Any actions taken since filing for divorce, or within two years prior, to waste, deplete or destroy marital property

The Definition
of Marital Property

What is considered marital property? The simplest answer is:  any asset acquired by either spouse since the date of the marriage.  Nonmarital property is anything acquired by either spouse prior to the marriage, after the date of filing for divorce, or anything acquired during marriage by inheritance or gift, so long as the gift is not from one spouse to the other. Generally, money invested into retirement accounts by either spouse during the term of marriage with earnings during the marriage becomes marital property, just as any other asset would, including houses, cars, and other tangible assets.

Even property acquired prior to the marriage can become marital property if it becomes “commingled.” For example, a house owned separately by one spouse can become marital property, in part, if, after marriage, the other non-titled spouse contributes funds to pay the mortgage, to the maintenance of the home, or to enhance the value of the property. Likewise, a personal bank account can become marital property if the parties deposit earned income into the account during the marriage.

A tool spouses can use to retain and protect non-marital property during the marriage is a properly executed prenuptial agreement.

QDROs and the Division
of Retirement Savings
and Benefit Payments

Qualified Domestic Relations Order

The division of retirement benefits requires the preparation of a Qualified Domestic Relations Order, or QDRO. The QDRO directs the retirement plan administrator to divide the affected assets or benefits between the spouses as provided in the court-ordered distribution.

When it comes to traditional retirement accounts like 401(k)s, IRAs and Roth IRAs, these may not require a QDRO, rather it can simply direct for a cash payout in accord with the court’s equitable distribution decision.

Defined Contribution Plans

Defined benefit and defined contribution plans are treated a bit differently. Defined benefit plans promise a certain monthly retirement payout after qualifying, say by working for a company for 20 years. If the period of marriage totals five years of the 20 needed, the divorcing spouse would typically be eligible for 50 percent of the accumulated sum for those five years. The payout could be a lump sum or a monthly payment upon the ex’s retirement.

Defined contribution plans are treated similarly to defined benefit plans. The divorcing spouse is generally eligible for 50 percent of the contributions made during the term of marriage.

Government Pensions

Government pensions pose a different challenges because they are not all the same.  Federal and many state pensions do not honor QDROs, however, the Florida Retirement System does accept QDROs.  Unfortunately, many municipal workers may not have retirement plans that accept QDROs, in fact, it depends on the municipality in which the party works.  And, military pensions are divided under the terms of the Uniform Services Former Spouse Protection Program.  Military pensions are unique and the computation can be complicated.

Work with Experienced
Family Law Attorneys

As you can see from the above, the distribution of marital assets and liabilities starts with the premise equity, but several factors can skew the final distribution calculation and can be difficult navigate. 

While it is always preferrable for the parties to amicably resolve these issues, it is not always possible and the court will have to make some tough decisions based on the list of “statutory” factors described above.  To protect your rights and interests, you will need experienced and knowledgeable family law attorney who can advocate for your needs and stand up for you.

If you are facing a difficult divorce, rely on the experienced family law attorneys at Fournier Law, PLLC. We would be happy to meet with you and discuss the details of your unique situation. You deserve accomplished legal counsel and compassionate advocacy — and that’s just what we can provide.


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