An attorney will help you divide your assets after a divorce—these include the savings held in any retirement accounts. There are several factors that contribute to how much you or your former spouse is entitled to and how long payments will be issued. To prepare to discuss your case with an attorney, here’s a brief overview of how divorce affects retirement benefits.

3 Retirement Benefits & What Happens to Them After Divorce

1. 401(k)

During a divorce or legal separation, a person is entitled to a portion of the benefits in their former spouse’s 401(k) account unless a prenuptial agreement prohibits it. The attorney for the person with the 401(k) should draft a qualified domestic relations order, which outlines how the funds will be paid to the receiving spouse. This document must be approved by a judge and a retirement plan administrator. The recipient can cash out the funds or put them in their own retirement account.

2. IRA

As part of the divorce settlement, a person won’t be taxed for the funds divided in their IRA account. The money is delivered through a transfer incident to divorce order. If the receiving spouse cashes out instead of putting the money in their retirement account, they may be subjected to taxes and penalties.

3. Social Security

A person can still receive their former spouse’s Social Security retirement benefits following a divorce. To qualify, the spouses must have been married for at least 10 years, and the receiving spouse must not have remarried. The spouse is entitled to earn no more than one-half of the benefit amount, which is issued in monthly installments. One-half of the benefit total is only given to spouses who have reached retirement age.

If you want help drafting a qualified domestic relations order or naming new beneficiaries on your accounts, turn to Darryl L. Jones, Attorney at Law in Alaska. Attorney Jones and his team help residents throughout the Anchorage and the Matanuska-Susitna area navigate the legal aspects involved with separation and divorce. They’ll take the time to understand your situation, so they can create a personalized plan that meets your needs and addresses any concerns. To schedule a consultation, call (907) 746-9851.