During the end of a marriage, as some couples in Washington will discover, the process of dividing assets might be stressful and complicated. One of the most important assets couples might hold is a pension plan. While they might not be currently enjoying the benefits of the plan, pension payments will be quite important once they reach retirement age so the negotiations over those benefits should be a priority.
Prenups and postnups
Some couples might find that planning ahead for the possibility of divorce, even when things are just starting and the relationship is doing well, might be the smartest option. While these types of agreements do have a risk of not holding up in court in complicated divorces, they are often a successful way to prevent additional tension if the marriage ends. A prenup or postnup can include provisions on how pension and retirement plans will be handled.
Keeping what you each have
If both spouses have separate pensions and retirement plans, they might agree to simply keep what each person has separately when they part ways. This is the most straightforward way, but it might work best for couples who will receive similar retirement benefits in the future.
Negotiating for your pension
When the pension is up for negotiation during the division of property stage, there are several ways couples can approach this. These include:
- Exchanging another property, such as a mortgage-free home, for the pension benefits
- Dividing the pension payments you will receive based on the time you were married through a court order that establishes how those payments will be divided within the rules of the pension fund
- Having your spouse claim the survivor’s benefit, if the pension plan allows this or negotiating a lump sum payment of their part of the benefit
These types of matters can be difficult to understand. During settlement negotiations, you might need the assistance of experienced professionals.