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How should older Missouri residents divide marital property?

These days divorce is a possibility for people of all ages, not just young adults. Missouri residents may be interested in a recent study showing that, in 2009, a quarter of all divorces involved people who were over age 50. The same study revealed that, from 1990 to 2009, the divorce rate among older adults doubled. Given that older people who go through a divorce have typically accumulated some assets over the years, how do these statistics relate to the question of dividing marital property?

First, retirement accounts are more often coming into play. So are pension plans and Social Security payments. Pension plans and retirement accounts make up a sizeable portion of many older Missouri residents' assets, and that means these assets have to be considered in a divorce settlement.

Not carefully dividing up pensions, retirement accounts and 401(k) plans can create unforeseen tax liabilities, as well as result in one party receiving an unfair portion of the assets. It is crucial, then, to determine exactly who owned which account and when. Typically, if money is added to a retirement account during the marriage, then the funds are regarded as marital property that can be divided. But if a 401(k) existed prior to the marriage, then that money could be treated as property that should not be included in the divorce settlement.

One way of clarifying how marital property should be divided is to complete a Qualified Domestic Relations Order, otherwise known as a QDRO. A court will issue this form, which, when filled out, will detail how much a non-employee spouse will receive from a private pension or a 401(k).

All of these matters can be extremely complicated for divorcing individuals in Missouri who are not familiar with our state's marital property laws. But taking the time to work out a truly fair division will help both sides avoid financial headaches and future litigation.

Source: Forbes, "How Divorcing Women Should Handle Retirement Accounts and Pension Plans," Jeff Landers, June 13, 2012

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Joseph J. Porzenski
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