by Ravelle Smith, JD of Cordell & Cordell, PC

Often people aren’t sure if they have a cash balance plan, a defined benefit plan, a defined contribution plan, or any of the other several retirement vehicles that exist.

In many cases, especially where there are lengthy negotiations over other issues, it is easy to get a little slipshod when it comes to the distribution of the parties’ retirement assets.  For example, one party may propose to “divide the assets in half” and the other party agrees, and something to that effect gets drafted into a settlement agreement.  However , retirement benefits can be a little more involved than some of the other issues in a dissolution of marriage. 

by Ravelle Smith, JD of Cordell & Cordell, P.C.

Drafting settlement agreements when retirement assets are at stake can sometimes be an unnecessarily tricky endeavor that falls to an attorney near the conclusion of a domestic matter.  Therefore, particular care should be given to cases that involve the distribution of retirement assets from the outset of the case, not only at the time of settlement and drafting of an agreement.  

by Milandria King, LL.M, of Cordell & Cordell, PC

Couples who find themselves in divorce proceedings may realize that in this economic climate, they are in need of more cash than is available to them. There is often an ongoing need for more cash flow following a divorce than one’s salary or maintenance payments may provide. The financial shortfall may operate to suspend negotiations regarding settlement, and this may prove to substantially reduce available funds.

Some divorcing couples have retirement assets which may help alleviate cash flow issues. Sometimes couples may be skeptical to use these assets for pre-retirement needs since most are of the mindset that these assets should be reserved solely for retirement purposes. This may be contributed, in large part, to concerns regarding distributions from retirement funds prior to age 59 and the resulting ten percent penalty tax.