- Firm Overview
- Practice Areas
- Family Law Victories
- Personal Injury Victories
- FAQ Videos
Whether you realize it or not, your 401(k), IRA, pension plan, or other retirement plan in Illinois is a marital asset—an asset to be divided with your spouse in the event of an Illinois divorce. In other words, your spouse becomes a “not so silent partner” with you in your retirement plan if you are divorced in Illinois; your soon-to-be ex spouse can claim part of that account or plan and receive part of your retirement savings even though he or she never contributed to your plan.
What can you do about that?
First, stop contributing to your retirement account if you are seriously considering divorce or are going through a divorce in Illinois. Deposits to your retirement plan that you make, even while the case is pending, creates a growing marital asset. Stop the contributions if you can.
Second, even if you are not going through divorce, keep perfect records of the amount in your retirement plan at the time you get married and afterward because some part of that plan may have been earned before you were married. However, the part before marriage is "non-marital" and is assigned to you by the divorce judge. Your spouse does not receive any part of the plan earned by you prior to your marriage.
Why keep records if I have to give my spouse part of my retirement plan upon divorce?
The amount that you or your employer deposited into your retirement plan prior to your marriage is your separate non-marital property. Additionally, any of the earnings of the premarital retirement plan, or the growth in the plan because of investment, are also non-marital. So, in order to keep your earnings from your retirement plan prior to your marriage, and untouchable by your spouse in a divorce, you must have records of how much your account was worth when you married and how much that pre-marital portion of your retirement earned or grew by investment, both prior to your marriage and after your marriage as well. The best way to do this is through records showing the detailed growth of your retirement plan.
Also, if your retirement plan allows it, you can always withdraw and spend down the plan. Your spouse will then receive a lesser interest or none at all. However, you will, of course, suffer the fate of not having a retirement plan. This is where I say, “Get yourself a good divorce lawyer well in advance of your divorce.”
Finally, before you get married, you create a prenuptial agreement which will exclude your spouse from any claim that he or she is a partner in your retirement plan if there is a divorce. You say, “It’s too late. We’re already married.” Not true. Instead, what you can do now that you are married is create a postnuptial agreement which excludes your spouse as a partner in your retirement plan. Still, you must get your spouse to agree in writing—not an easy task. This is where the divorce lawyer part comes in and good planning in advance of your divorce is always a good thing.
Consult with a Skilled Illinois Family Law Lawyer Today
If you are considering divorce, our experienced Hinsdale, IL family law lawyers are here to answer your questions and concerns. Contact us today at 630-920-8855 to schedule your free consultation.