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How to protect your retirement during divorce

by | Aug 14, 2023 | Family Law

Divorce impacts your financial and emotional health, and if you are older or have significant assets, the financial impact can be staggering.

If you face a divorce, one of your most important concerns may include protecting your retirement accounts. These are some ways you can protect these funds.

Community property vs equitable distribution

Some states divide your marital assets based on equitable distribution. Other states consider marital assets community property and divide them equally between you and your spouse. Texas is a community property state.

Calculate your personal and marital assets

Anything you owned before you got married, including your family home and any money you put in your retirement account and the dividends you earned, are personal assets. However, after you got married, everything you contributed and any dividends you earned are marital property.

Calculate all your personal assets as well as those of your spouse and your marital assets. Also, calculate how much you contributed and earned on your retirement during your marriage as well as how much your spouse contributed and earned because the courts only consider the difference in these two numbers during the division of assets.

Check your retirement plan rules

Some accounts allow dual distributions when you start taking money out. You should also ask whether you can receive a lump sum or an annuity-type payment. You may offer your spouse a lump sum or annuity payments after you start receiving your benefits.


Community property receives equal division, so you can offer other types of marital property that have the same value as your retirement account, such as vehicles, artwork and your family home.

Search for opportunities to negotiate and balance the division of your marital assets to protect your retirement funds.