Are Retirement Accounts Marital Property?

dividing retirement divorceBy Jennifer M. Paine

Divorce Lawyer, Cordell & Cordell

If you think your retirement account is yours because you (and possibly your employer) contributed to it with your hard earned money from years of work, well, you’re wrong.

In most states, it makes no difference whether the money is yours, your spouse’s or your employer’s.

So long as the value of the account accrued between the date of your marriage and the date of your separation or your divorce, that money is at least one-half your spouse’s, too.

This means all of the dollars you and your employer put in, plus any appreciation in pre-marriage dollars from your active investments, are your spouse’s, too.

Some guys are shocked to find this out naively believing that they worked so that they could one day retire and, therefore, should be able to keep the money they earned to retire.

The theory in most states, however, is that he worked so that he and his wife could retire, so they should share in that money.

This is a bitter admonition for a guy whose wife is divorcing him, particularly if she does not have a retirement account of her own and expects him to pay child support and alimony and give her half of his stuff, too.

However, the sooner you accept it, the sooner you can prepare to negotiate the things in your divorce that are worth negotiating.

If the law in your state says she’s entitled to half, then you do yourself a huge disservice (and probably pay your attorney a lot of money) to argue otherwise, absent a really, really good reason. And those are tough to come by.

That being said, if your wife has a retirement account, no matter how small, don’t be afraid to ask for your share. If nothing else, you can offset it against her large share of yours.


Read the other divorce articles in our retirement advice series:


Jennifer M. Paine is an Associate Attorney in the Detroit, Michigan office of Cordell & Cordell. She is licensed to practice in Michigan, and has been admitted pro hac vice in Illinois, Ohio, and the United States Court of Federal Claims.

Ms. Paine received her BA in English and Mathematics from Albion College and graduated Summa Cum Laude. She received her Juris Doctorate from MSU College of Law and graduated Summa Cum Laude.

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