Photo of Ray Ferrara CFP Ray Ferrara CFP Jan 10, 2021

Part of any divorce involves splitting marital property that spouses have acquired throughout the marriage, such as housing, transportation and other personal property. One of the largest assets that is subject to division in a divorce is your retirement savings account, such as your 401(k).

The rules for how a 401(k) is split in a divorce vary from state to state. In Florida, retirement plans that developed during the marriage are property of both spouses. How exactly this is split though is a little bit more complicated.

How is your 401(k) split in a divorce in Florida?

What usually happens is that officials will calculate a percentage of the amount of the 401(k) that was built up during the marriage. This will be used to determine the amount split.

Florida is what is known as an equitable distribution state. What this means is that the courts make a fair and just assessment of the marital property and determine that it will be split as evenly as possible. 

What may happen with your 401(k) is that the percentage of contributions made during the marriage may be split evenly, while the contributions made prior to the marriage will remain entirely with the original contributor. However, depending on your individual circumstances, judges may rule differently. In order to protect the tax status of these retirement assets during a divorce, a Qualified Domestic Relations Order (QDRO)

Talk to a ProVise CFP® professional about protecting your finances in a divorce

Your 401(k) contributions represent a large portion of your assets. It is important that everything is documented and filed properly, so courts can clearly see how much should stay with you and how much goes with your ex-spouse. It can be easy to overlook small details because you have so much else going on. However, our team can step in and help as your financial guides during this hard time of life.

At ProVise Management Group, our CERTIFIED FINANCIAL PLANNER™ professionals can get to know you and your current financial circumstances, goals, risk tolerance and personal values to help you develop a personal financial plan that works for you. We can also create a written plan for you at a fiduciary standard of care. All our written plans come with an unconditional money-back guarantee. If you are unhappy with your written plan, you can return it to us, and we will refund 100% of the fee paid.

Are you ready to talk to a professional about protecting your 401(k) during a divorce? Contact ProVise today to schedule a complimentary consultation.