If you’re going through a divorce in Maryland, there might be a lot on the line. You’re likely dividing up financials with your ex-spouse, so it’s understandable to wonder what happens to your pension after getting divorced. Here are a few helpful ways to protect your pension during this time.
Take a closer look at your pension plan
Most pension plans give the recipient a choice between getting a monthly annuity or receiving a larger, lump-sum payment. One popular way to protect your pension is with a single-life payout. With a single-life annuity, you stop receiving payments after your death. If you have a joint-life payout, these payments would continue going to your spouse after you pass away.
Find out your state’s laws
It’s also important to note that divorce rules differ depending on what state you live in. Therefore, it’s wise to take a look at your state’s law regarding how to divide a pension after getting divorced. To receive any of your pension, your ex-spouse will need to make a proper request, otherwise known as a Qualified Domestic Relations Order, during the divorce proceedings.
Come up with an alternative solution
There’s also the option of bargaining with your ex-spouse. Instead of them receiving part of your pension, there might be other assets you could hand over. For instance, asset division that gives them a larger share of real estate might be a beneficial choice instead of dividing your pension. You might also consider purchasing a life insurance policy that’s equal in value to your pension. After doing this, you could name your ex-spouse as the beneficiary.
It’s possible to keep your pension after a divorce. However, it is a good idea to contact a lawyer if you’re worried about keeping your pension.