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Denver Parental Alienation

Division of Retirement Benefits in Denver

During the divorce process, when the division of assets is considered, one of the key issues that is sometimes overlooked is how retirement benefits will be divided.

When people think of assets accrued during a marriage, the tendency is to think primarily about the home, other real estate, investments, savings, cash, cars, and valuables.

However, retirement accounts are often the largest asset after real estate in a marriage. It is sometimes omitted from calculations, especially when the divorce happens many years before retirement.

Retirement benefits must form a large part of the discussion when it comes to dividing the marital assets.

The family lawyers at Colorado Legal Group have extensive experience in guiding clients through the divorce process, including the division of assets, so that the divorce agreement leaves them in the best possible financial shape for the future.

What happens to retirement benefits in a divorce?

In divorce cases in Denver, the way that pensions, 401ks, and other retirement accounts are divided is generally based upon their increase in value during the time of the marriage. 

This is usually decided at the same time that other joint marital assets are divided. However, it is not generally a simple calculation to make.

For instance, say you were married for 10 years but the retirement benefits had been amassed over a total of 30 years. Only a third of the retirement account would be considered “marital property” and only marital property is subject to division. If the Court chose to divide the marital property equally, each spouse would then be entitled to around 16.65 percent of the value of the retirement at the time of divorce. But in Colorado, division of marital property is not always equal, the Court will ultimately decide what is equitable or fair.

After the divorce is finalized, a court order (called a qualified domestic relations order or QDRO) is usually prepared by an expert to divide the accounts as shown, more on this directly below. 

 

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Division of Retirement Benefits in Denver

Qualified Domestic Relations Order & Domestic Relations Order

What is a Qualified Domestic Relations Order (QDRO) and a Domestic Relations Order (DRO)?

A Qualified Domestic Relations Order (QDRO) instructs a Plan Administrator of a retirement account how to pay a share of plan benefits to an ex-spouse. This qualified domestic relations order is almost always necessary for payment to be made directly to the divorced spouse, except that some Plan Administrators do not require it depending on the type of retirement account.

A Domestic Relations Order (DRO) is used for pensions (vs. private retirement accounts).
Denver Divorce Lawyer

Need Help Dividing Your Retirement Benefits?

Call Colorado Legal Group at 720.594.7360 or get started with a complimentary case evaluation.

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Do you need a lawyer to assess and divide pensions and retirement accounts?

Yes, it is always advisable to involve your lawyer as early as possible in the process when discussing the key elements of a divorce settlement:

  • The division of assets (including retirement)
  • Child custody and visitation rights
  • Child support
  • Spousal support

Because divorces are emotional times for the parties concerned, an experienced divorce attorney can mitigate the stress and help you make clearer decisions that are in your immediate and long-term interests.

When it comes to pensions and retirement accounts, this can be a complex area that requires experienced advice and knowledge of various pension systems. An expert may need to be hired to value a pension and/or to prepare the QDRO.

You need someone to help guide you with:

  • How retirement benefits are divided?
  • Who is going to pay?
  • When are payments going to be made?
  • For how long will payments apply?

You also require a lawyer who understands the relevant changes to the law regarding pension payments to ex-spouses. Mistakes can cost you many thousands of dollars.

Our lawyers have specialist knowledge in this area, including in the division of military retirement benefits. Our lawyers also know the right experts to help value and/or divide retirement benefits.

Common mistakes with dividing retirement benefits

Mistakes are commonly made in this area – even by established Denver lawyers. These can be very costly.

Some typical errors include:

  • Not addressing the survivor benefit in the first decree (and therefore losing your rights to the benefit)
  • Not understanding that retirement benefits are pre-tax (so withdrawing cash will be taxed)
  • Not notifying the plan administrator that there will be a division of the plan

How our lawyers can help you reach fair results

The experienced lawyers at Colorado Legal Group can help ensure that you’re not losing thousands of dollars by incorrectly dividing pensions and retirement benefits.

Over the years, we’ve worked with so many different pension plans for the benefit of our clients that we have built considerable specialist knowledge of how to get the best results.

We will guide you towards an agreement that is fair and equitable and that can be approved by the court.

So that we can look out for your best interests, involve your lawyer at the beginning of your divorce discussions before you start dividing assets.

Need help with the division of retirement benefits in Denver??

Call Colorado Legal Group at 720.594.7360 or get started with a free case evaluation. Get Started 

How Can We Help?

Phone:
720.594.7360

 

Email:
info@coloradolegalgroup.com

 

Address:
1777 S Harrison St. #1050
Denver, CO 80210

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