A spouse's interest in a retirement fund is an asset. If the couple was married for nine years, that asset probably increased during that time. As part of the divorce, the parties divide the value of the marital assets, i.e., generally speaking, those that were not brought into the marriage or gifts to a particular spouse. The money going into the retirement fund, is no different than the money that went into the bank while the parties were married. It accumulated, and hopefully increased through interest or earnings. In making a determination of the value of the marital assets, the retirement funds will come into play. If there is a $100,000 in the bank and retirement funds generate during the marriage worth $100,000, and no other assets, on person could get cash, and the other person the retirement funds. Or, each could take $50,000 of cash and $50,000 of the retirement benefits. If it is necessary to use the retirement funds to divide the assets, a Qualified Domestic Relations Order (QDRO) can be entered into and the retirement fund will divide the benefits as instructed by the court as part of the settlement. (The QDRO is required due to the anti-alienation rules that generally prohibit someone from acquiring an interest in the retirement funds of another person.) The needs of the parties, including immediate and long term implications, should be carefully considered, and there can be interesting issues that make it well worth the money the parties spend on their financial and legal advisers. Many firms, like ours, give free initial consultations to help decide if it is worth paying the $150/hour that our lawyers, and some others, charge, to arrange the ideal split of assets....
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