How Are Retirement Plans Divided in Connecticut Divorces?
You’re wondering how are retirement plans divided in Connecticut divorces. We’re here to help, so please read on.
Retirement accounts are one of the major property types that Connecticut courts divide during a divorce.
If you boil it way down, Connecticut courts help divorcing couples determine three main things in a divorce:
- How and whether money will flow (think alimony and child support)
- How custody and parenting will work
- How property will be divided.
Retirement savings fall into Category 3 — property division.
How Are Retirement Accounts Divided in Connecticut Divorces?
The most common misconception out there is that property gets divided 50/50 in Connecticut. In fact, there is no default that property must be divided 50/50.
Connecticut is an “equitable distribution” and an “all property” state. “Equitable” does not mean equal, or even half, but rather what the Superior Court considers fair. “All property” means that the courts have jurisdiction over all the property that both spouses have, marital and separate.
Property subject to division in Connecticut includes:
- Property that each spouse acquired prior to the marriage
- Property in the name of one spouse only
- Inheritances and gifts
Retirement accounts often fall into both Category 1 and Category 2. Retirement accounts are in one spouse’s name only and some or all funds may have been accumulated prior to the marriage. For example, if you worked prior to your marriage and had 401(k) savings associated with work during that time, those assets are subject to division by a Connecticut court. Remember this does not mean that retirement accounts are divided 50/50, because Connecticut divides property “equitably.”
Read: What Types of Employer Retirement Accounts Are Divided in Connecticut Divorces?
What Factors Do Connecticut Courts Consider When Dividing Employer Retirement Accounts Equitably?
When dividing up marital property including retirement accounts, several different factors are taken into consideration. They include but are not limited to:
- How long your marriage lasted
- The reasons why the marriage came to an end
- The respective ages and health condition of each spouse
- The current income, occupation, and employability of each spouse
- The personal assets and liabilities of each spouse
- The ability of each spouse to be self-sustaining
- The contribution that each spouse made to the acquisition, maintenance, or appreciation of marital assets
Read: Top 3 Property Division Myths
Read: What Factors Are Considered When Dividing Property in a Connecticut Divorce?
The Comprehensive Connecticut Property Division Guide
How to divide property is one of the most important issues in divorces. And, it’s one of the most confusing. There are no set formulas or rules on how property will be divided. The good news is that creates tremendous flexibility for experienced divorce attorneys to craft an individualized approach. In order to prepare to make solid and informed decisions, you need to understand how property division works. Our Comprehensive Connecticut Property Division Guide tells you everything you need to know about property division in Connecticut.
Read: Property Division: The Comprehensive Connecticut Guide
Now that you have learned more about how retirement plans are valued in Connecticut divorces, you may want to learn more about what types of retirement accounts are divided by Connecticut courts. Or, now that you have more information about how retirement accounts are divided in Connecticut, you know that it isn’t simple. Considering the level of discretion courts have when dividing marital assets, it is vital to have experienced legal counsel on your side. There is a lot of opportunity for creative negotiations, strategy, and solutions. Our first step at Freed Marcroft, the Goals & Planning Conference, is designed to get to the heart of your problem and unveil your true goals. Then, we take those goals along with the facts of your case and analyze them so that we can present you with recommendations and options on how to move forward.