Your retirement savings is a vital part of your financial future. However, if you and your spouse end your marriage, you may wonder whether your divorce will also upend your retirement plans. What should you know about what happens to these funds during divorce?
Is my retirement fund marital property?
In Nebraska, whether a retirement fund falls into the category of marital property depends on when you put the money into that fund. Generally, any funds accumulated during the marriage are considered marital property and thus subject to division upon divorce. This can include retirement savings like your 401(k) as well as pensions and other benefits.
However, any portion of the retirement funds that were accrued before the marriage or after the date of separation generally falls into the category of separate property. The court does not divide this property, and it would remain yours after your marriage ends.
How do Nebraska courts divide retirement funds?
Nebraska is a “equitable distribution” state. This means that in the event of a divorce, the courts divide property in a way that is equitable or fair. The courts consider a variety of factors to decide what is equitable, including the length of the marriage, the economic circumstances of each spouse and your financial and non-monetary contributions to the household.
It is important to note that the exact nature of the split will depend on the specifics of the case. The court will look at factors such as the age and health of both parties their future financial prospects, and the needs of any children from the marriage to determine what portion of your marital assets each person receives. You may also be able to prioritize keeping your retirement fund by allowing your spouse to keep a larger share of your savings or other assets of a similar value like your marital home.
Given the complexities involved in dividing retirement funds, you may want to speak to a financial advisor and an attorney during this process. A financial advisor can help you adjust your financial strategy to protect your future stability, and an attorney can help you protect your retirement savings during the divorce process.
Ultimately, arming yourself with the right information is an important first step when dividing retirement savings in divorce. By taking these steps, you can make informed decisions that pave the way for a stable and secure future.