I Am Worried I Will Lose My Pension in My Illinois Divorce. What Can I Do?
Pensions and other retirement funds are essential aspects of many individuals’ long-term financial planning. It can take enormous sacrifices and years of hard work in the hope of a secure future, and when divorce threatens that security, the implications can be frightening.
While pensions and other retirement funds are generally seen as marital property and are subject to division in a divorce, the good news is that there are often things you can do to help protect yourself during the property division process and having an experienced Illinois divorce attorney can help.
Are Pensions Marital Property in Illinois?
If a spouse began earning their pension or retirement funds before they got married, the funds earned before the marriage will usually remain private property, including any increases in value through capital gains. But any portion of a retirement that was earned during a marriage is seen as marital property, even if the pension funds are not vested or have not matured.
How Can a Pension Plan Be Divided?
Sometimes, spouses do not need to divide pension or retirement plans and can instead trade different marital assets for full ownership of their retirement funds. Spouses can also divide the pensions according to their own agreement, or, if they cannot agree, a court will divide the couple’s marital property. Either strategy requires the help of a financial professional who can estimate the value of a pension using common valuation methods.
When spouses split their pension or retirement fund, they can get a Qualified Domestic Relations Order, or QDRO, from the court. A QDRO allows the plan administrator to split the benefits or payments according to the spouses’ divorce arrangement. This allows spouses to each receive their portion of the benefits without having to depend on each other for payments or remain in contact. It is important to note that, after a plan has been divided, the spouse who is not the policyholder cannot take advantage of the plan’s benefits until the plan actually begins to pay.
Schedule a Consultation with a St. Charles Property Division Attorney
The fear of losing your retirement savings is a legitimate concern during any divorce, especially if you are close to retirement age. At Shaw Sanders, P.C., our St. Charles property division lawyers work passionately to ensure our clients get a fair division of marital property so they can continue working towards their long-term financial goals during and after divorce. Call us today at 630-584-5550 to schedule a free consultation and learn about what we can do for you.