Virginia is not a community property state, meaning that if you get a divorce, your assets will not necessarily be divided equally. However, if you have a pension plan, your spouse is usually entitled to a portion of what you earned while you were married. This is the case even if your pension is not yet in “pay” status and you still have many years of work ahead of you. You might be able to keep your pension plan if you are willing to look at other options that may give your spouse roughly the same amount they would get from your pension.
Alternatives to splitting a pension
The easiest situation is if both of you have a retirement account and those accounts are roughly of the same value. If this is the case, as you negotiate asset division, you may simply both agree to walk away with what you have. Perhaps the next easiest solution is to allow your spouse to have another asset of similar value.
Complications of splitting a pension
Dividing the pension plan itself can be complex. You will need to work with the plan administrator, and you will need prepare the appropriate order of division, whether that is a Court Order Acceptable for Processing, or a qualified domestic relations order. This is all done around the same time that the divorce is finalized. You must also understand several other elements of your plan before you can talk about how to divide it. This includes whether or not there is a survivor’s benefit with the plan and how payments are distributed. To fully understand your options and how you might protect your plan, you may want to consult a certified divorce financial analyst. These are financial professionals with a background in divorce.
If you and your spouse cannot reach an agreement about how to split your property, you will have to go to court where a judge will decide. The potential drawback is that you might be unhappy with that decision. Usually, in the absence of an agreement to “trade” or equalize assets, the court is simply going to divide each asset individually, thereby almost assuring your spouse of their marital share of your pension. Therefore, if you hope to negotiate an arrangement where your spouse waives their interest in your pension, your best option will be to try and settle your case.
The attorneys at Maddox & Gerock, P.C have experience in negotiating settlements as well as litigating high-asset cases that include pensions. Schedule a consultation with our firm to discuss your retirement assets and how we may be able to assist.
