Will a Divorce Impact My Retirement Benefits? 

During their marriage, couples often make plans regarding when they would like to retire. These generally include the type of lifestyle they want to live and how they will financially support themselves in the process. When marital troubles arise and the decision to get a divorce is made,  these plans are likely to fall by the wayside but the need to ensure your future financial security remains. The following details some of the ways in which a divorce in Illinois could impact your future plans and your rights to retirement benefits.    

Divorce and 401ks, Pensions, and Other Retirement Accounts

In planning for retirement, many people either look towards pensions they receive through their jobs to make ends meet or contribute to 401ks, IRAs, or other retirement accounts. How are these types of funds impacted in a divorce? 

Under the Illinois Statutes, any marital property and assets earned, acquired, or accumulated during your marriage are split between the spouses on an equitable basis. This includes any pensions or retirement accounts either person contributed to over the course of the marriage. The judge in your case will consider various factors in determining a split that is fair to both parties involved. These are likely to include: 

• The length of the marriage;
• Each spouse’s income or earning potential;
• The amount of non-marital assets they possess;
• Their individual contributions to the marriage. 

If you were the primary breadwinner, your spouse may be entitled to a portion of any retirement benefits you earned as part of your divorce. Considerations in dividing these benefits include tax ramifications and any other property and asset settlements that are made. 

For the spouse receiving a payout of retirement benefits, it is important to obtain a Qualified Domestic Relations Order (QDRO) during your divorce, which is required by retirement account plan administrators before they can release these funds. You will also want to consider rolling any amounts you receive over into your own IRA to avoid penalty fees.   

Your Rights to Social Security Benefits After a Divorce

Depending on the circumstances surrounding your divorce, in addition to your right to pensions and other retirement accounts, you may also be entitled to a portion of the Social Security Administration (SSA) retirement benefits your spouse receives. You may be eligible for these benefits if: 

• Your marriage lasted 10 years or longer;
• Your spouse is 62 or older;
• You have not remarried;
• The amount of your spouse’s SSA benefit is greater than what would be entitled to on your own. 

Contact Our Chicago Area Divorce Attorneys and Request a Consultation Today

At the Women’s Divorce and Family Law Group, you can count on us to protect your rights to retirement benefits in your divorce. Contact our Chicago area divorce attorneys and request a consultation today.