The financial aspects of divorce should always be considered, but those who are about to retire or already there might need to take those considerations a step further. If your finances are about to be affected by both divorce and retirement, take a look at how to handle things to ensure that your future retirement days are secure and positive.
Ask For What You Need
As you age, your ability (and desire) to earn more income may be limited. Particularly for those who are beginning to experience medical conditions, you must take action during the divorce to ensure that you don't end up in dire financial straits afterward. There are several ways to ensure that you get your fair share during divorce:
Take Advantage of Your Spouse's 401(K)
Many spouses fail to recognize that their spouse's investment account is considered marital property. The Qualified Domestic Relations Order (QDRO) is the route you need to take so that you can get your fair share of this potentially valuable marital asset. The QDRO is connected to the divorce but is not technically a legal part of the proceedings. Your lawyer will need to specifically address the QDRO by contacting the administrator of your spouse's benefit account and filling out the required paperwork during the divorce. Don't wait until afterward. What makes the QDRO so unique is that the funds can be dispersed without having to pay the usual penalties and fees associated with making withdrawals from a retirement account.
Take Advantage of Your Spouse's Social Security Earnings
If you and your spouse have been married for at least 10 years, you may be entitled to more of a Social Security retirement benefit. The Social Security Administration (SSA) will determine which of the accounts between the two of you will pay a larger benefit, and you will automatically receive that benefit. For instance, if your benefit amount at full retirement is $1,500 and your spouse's benefit is $3,200, you would be entitled to earn one-half that amount, or $1,600, by using your spouse's earnings.
Speak to your divorce attorney about the above issues.