For many exes in Pennsylvania, divorce can lead to major complications in retirement planning. Because retirement funds are often among the largest assets held by a married couple, the effect of splitting them in a divorce settlement can be significant. Exes may need to escalate their savings plans in order to restore their funds, especially as the cost of retirement continues to rise. A divorce can have significant, long-term effects on financial planning even beyond the immediate results of property division.
There can also be a strong psychological impact when dividing retirement funds. In many cases, these accounts were held in one person's name despite being accumulated throughout the marriage. Dividing them can feel different than selling a home or dividing a joint banking or investment accounts. Even for people engaged in a high-asset divorce, retirement funds of various kinds can make up a significant portion of the overall property division process. There are different solutions that spouses can devise, from a straight 50-50 split to alternative options. In some cases, each partner will simply keep the retirement accounts from his or her own job.
Divorce can affect wealth over the years. On average, divorced households have around 30 percent less net worth than non-divorced households. They also are 7 percent more likely to have insufficient funds to get through retirement.
The division of assets in a divorce can be one of the most complex aspects of the end of a marriage, with results that linger long after the relationship is over. A family law attorney can work with a spouse engaged in a complex, high-asset divorce to help ensure a fair settlement in terms of property division, spousal support and other matters.