Divorce can be a tough time for anyone, make sure it doesn't also affect your retirement plans.

Divorce can be a tough time for anyone, make sure it doesn't also affect your retirement plans.

Life throws all kinds of surprises your way. Some are great while others, not so much. When divorce is on the horizon, make sure your retirement plan will still be there when you need it most. When you’ve worked hard and saved your entire life to ensure that your retirement is comfortable, you might be worried that a divorce will sabotage those plans. Here is some guidance about what divorce can do for your retirement.

 How Your Savings Get Divided After Divorce

If you opened up a savings account before you were married, the money that you deposited into that account before the marriage will likely be yours to keep in full after your divorce. However, money that you deposited into the savings account after your marriage may be considered marital assets by a divorce court. In that case, it’s possible that a judge will rule that your spouse is entitled to 50% of the portion of the savings that were deposited after the date of your marriage. Laws vary by state, so the final ruling will depend on where you live.

The Division of IRAs and Pension Plans

With company pension plans and IRA accounts, the shared assets laws can also affect how much of those savings you get to keep after a divorce. In general, any pension plan or IRA that came into existence after your marriage date would be considered joint assets. As such, your ex-spouse would be entitled to half.

How is Real Property Divided?

In the case of real property, such as a vacation home or an investment property, you and your spouse would have to split the taxes and cost of upkeep of the property. To ensure a good retirement, it’s a good idea to try to come to some kind of amicable agreement with your ex-spouse. Consider having one person buy out the other, either as a lump sum or in payments. Or, sell the property and split the profits as liquid assets.

Divorce doesn't have to ruin either spouse’s retirement plans. It’s possible to manage the joint assets of the partnership in such a way as to make it possible for both parties to retire as comfortably as you originally planned. When possible, try to develop a dialog with your ex-spouse that enables both of you to ease out of the marriage without suffering financially.