Property division during divorce can impact retirement plans

Getting divorced in Pennsylvania can be a financial shocker no matter how long a couple has been married. However, the longer two people are married, the more that is likely at stake when it comes to property division. This is particularly true for those who are close to retiring.

Following a divorce, it is common for a spouse's household income to significantly drop, even though the living expenses do not. In fact, without two incomes, the spouse may no longer be able to defer a portion of his or her salary into a 401(k) plan or another plan sponsored by an employer. After all, he or she must meet his or her living expenses first.

For spouses who must pay alimony to their exes following divorce, this is yet another important consideration following divorce -- a line item to add to their new post-divorce budgets. In addition, those with young children may have additional expenses tied to child support or child care that simply did not exist during the marriage. Those who are divorced may even find themselves trying to maintain two homes -- their own homes and their children's homes -- which will most likely impact their ability to contribute money to retirement savings.

Divorce is a major life event with long-term consequences. Unfortunately, making even one major mistake can be costly down the road. An attorney in Pennsylvania can help with fighting for one's fair share of assets during a divorce proceeding involving property division, with the goal being to achieve a settlement that puts one in the best position possible to financially succeed in the years ahead.

Source: forbes.com, "Does Divorce Derail Retirement?", Larry Light, July 24, 2017

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