Retirement assets are subject to division during divorce

Many married couples plan ahead and count on assets set aside for the later years in life. However, amid all this planning, people might not count on divorce happening, which can have an impact on existing retirement assets.

Knowing that retirement accounts aren’t immune from divorce proceedings, readers might be wondering: How will these assets be split? For the most part, this can be answered based on Alabama family law and when the assets in question were acquired.

Alabama is an equitable division state, which means that marital assets are subject to be split in a way that is considered fair to each spouse. In some cases, this means that it might not be an even split. As such, retirement assets that are acquired during the course of a marriage are distributed in accord with state property division laws.

Although this provides a very basic picture of how retirement accounts might be split, the process by which they are divided can vary depending on the specific type of asset being handled.

For some types of retirement assets, such as 401(k) accounts or profit-sharing plans, a Qualified Domestic Relations Order, or QDRO, is necessary to disburse assets to the spouse who doesn’t own the account. This is a document that specifies that a person’s claim to a portion of a retirement account.

On the other hand, a QDRO might not be necessary to split other assets during divorce. Generally speaking, this is true for IRAs included among marital assets.

Sorting through a variety of assets and understanding the steps to divide each of them might seem overwhelming, especially since every couple enters divorce under unique circumstances. As such, seeking the assistance of a family law attorney during this process could ease much of this confusion.

Source:, “Biz Brain: Splitting a retirement plan after divorce,” Karin Price-Mueller, Jan. 26, 2014