Going through the end of a marriage can be an emotional and intimidating process at virtually any stage of life. However, individuals in Alabaman who are approaching retirement age may face certain factors that might prove unique to their situation. As retirement assets could play a significant influence in the outcome of a divorce, knowing what to expect from the process and how best to prepare to protect one’s interests could prove vital to preparing for what comes next.
According to experts, retirement accounts are one of two types of assets that often consist of a sizable portion of a couple’s wealth. Retirement assets that are deemed marital property will be subjected to the process of property division and dividing similar assets can be somewhat complex in nature. Some types of retirement accounts, such as a 401(k), might prompt a need to obtain a Qualified Domestic Relations Order before assets can be divided without incurring costly tax penalties.
Experts state that there are also strict rules for dividing retirement assets such as IRA accounts. While a person might be able to place assets into another IRA without incurring penalties, should one wish to withdraw funds, addressing topics such as early withdrawal fees and tax ramifications prior to choosing a path could prove imperative. It may also be helpful to note that taking care to divide retirement assets in accordance with the terms of the divorce decree may also be integral to staving off potentially costly fines and penalties.
Protecting one’s future
While those who are going through a divorce might have concerns about how the outcome might affect their lives, a similar life change does not have to derail one’s plans for retirement. Individuals in Alabama who have similar concerns could benefit from consulting with a family law attorney for advice on their available options and in making informed decisions about their situations. In doing so, a person could become better prepared to create a strategy with which to safeguard his or her future during divorce proceedings.