How Are Retirement Plans Divided During an Illinois Divorce? 

 Posted on February 10, 2022 in Uncategorized

During a marriage, couples share virtually everything from a home, to cars, to children. Property division can be a difficult, and often contested, hurdle to overcome during a divorce. Many times, physical property holds an important or sentimental value to you and your family, and it can be hard to decide who gets what during a divorce. It is important to protect each party’s financial wellbeing during a divorce, and this often includes dividing retirement plans. 

Understanding Your Retirement Plan and Marital Property

Any retirement plan strategies financial savings over the course of a person’s life to allow them the means to stay comfortable after retirement. It is fairly common for married couples to have retirement plans. As wealth is accumulated during a marriage and over the course of someone’s career, the money that is put into a retirement plan. Retirement funds accumulated by a spouse during the marriage are marital property to which both spouses have a right. When dividing assets during a divorce, this can be a tricky situation when deciding how much each spouse receives. Types of retirement plans can include:

• Your 401(k)

• Your Individual Retirement Plan (IRA)

• Pensions

How is a Plan Divided in Illinois 

After your file for divorce in Illinois, the court or your divorce attorney will begin to complete your divorce order including the division of assets. For certain types of retirement plans, spouses have the option to use the Qualified Domestic Relations Order (QDRO), which is a court order that will divide the retirement plan between the two spouses. In Illinois, you can file for a Qualified Illinois Domestic Relations Order (QILDRO). If your retirement plan is an IRA, however, using the QDRO process is not required. 

The financial assets within the retirement plan will be disbursed according to when the money was put into the retirement account. If you began your retirement prior to your marriage, you may be able to receive more money. If a spouse worked for a few years and contributed to 20% of the pension for the retirement, that 20% of the retirement plan would be considered that individual’s property, and the rest of the plan may be considered marital property. Each retirement plan division may be unique to the marriage itself. If you are looking to divide your retirement plans, it is best to first speak with an attorney who is experienced in ensuring your financial interests are protected. 

Contact a Naperville Divorce Attorney

The Law Office of Ronald L. Hendrix, P.C. is skilled in protecting the rights and assets of spouses during a divorce. Our Will County divorce lawyers Ronald Hendrix and Christopher Hendrix are prepared to help you divide your retirement plan and other marital assets. For a free initial consultation, call us today at 630-355-7776. 

Source(s):

https://www.ilga.gov/legislation/BillStatus.asp?DocNum=4904&GAID=15&DocTypeID=HB&LegId=125059&SessionID=108&GA=101  

https://www.ilga.gov/legislation/ilcs/fulltext.asp?DocName=004000050K15-136.4