One of the touchiest parts of going through a divorce in Illinois is figuring out how to split assets with one's spouse. This is because the decision made during a divorce regarding assets has a long-term impact on a person's financial situation long after the divorce has been finalized. Retirement assets, such as a 401(k) or a 403(b), can especially be challenging.
Divorce decisions are often the most expensive decisions people make. Just as a person may work hard over the years to build assets and achieve a healthy financial situation, it is important for an individual to tackle property and asset division during divorce strategically, thinking about the big picture. A few tips may help people in Illinois to make divorce-related decisions, while taking into consideration the financial consequences of those decisions.
Some readers from Illinois may wish to learn more about what can happen to a 401(k) in the event of divorce. In general, 401(k)s are subject to distribution during divorce under similar guidelines as other assets; however, the extent of each spouse's contribution can inevitably provoke a significant impact.
When people get married, they tend to divvy up household duties such as lawn work, paying bills, grocery shopping or what-have-you. A problem that arises in divorce, then, is that one spouse has handled the financial side of the marriage, while the other spouse has essentially kept out of money matters. This happens more often than you might expect.
What are Qualified Domestic Relations Orders, and how do they relate to asset division in Illinois divorces? QDROs are used to give an alternate recipient the right to receive funds from a private-sector retirement account such as a 401(k) or a pension plan. The alternate recipient could be the plan participant's child, spouse or former spouse, so you can see why QDROs are important in dividing assets in the divorce process.