Getting divorced means whatever future plans you had for yourself and your spouse must change. That includes your dreams for retirement. The two of you might have made plans for your post-working years, but those won’t happen now.
That doesn’t mean you cannot enjoy a comfortable retirement. Just that your ex won’t be a part of it. But to make your new retirement plans a reality someday, you will need the savings. Most people in Austin cannot afford to retire without funds from the 401(k) they spent decades contributing to, either directly or indirectly. Preserving your retirement savings — or at least your fair share of it — as part of your divorce’s asset division is crucial.
Unlike most states, here in Texas, we practice community property in divorce asset division. All community property, which are most things acquired during the marriage, must be divided 50/50, while separate property belongs to each spouse alone. Thus, you likely are entitled to half of the retirement savings, whether you contributed through earning an income or indirectly through focusing on raising the children and keeping the house so your spouse could concentrate on their career.
An exception to this 50/50 requirement could come from a prenuptial agreement, which is a contract a couple negotiates and agrees to before getting married. You can use a prenup to determine ahead of time how you would divide your assets if you ever divorce. This can make divorce and post-divorce retirement planning more predictable.
Making sure you know what your 401(k) is worth
With community property, so much depends on getting an accurate valuation. You might think this would be fairly straightforward with a 401(k) or other retirement account, which your broker regularly sends you statements for. But an unscrupulous spouse might try withdrawing from the account or hiding it to avoid sharing it. This is against the law and an experienced divorce attorney will be able to detect suspicious activity.
Worries about affording retirement do not have to be a reason to stay in a failed marriage. The help of a skilled divorce attorney can ensure that your golden years are enjoyable and financially stable.