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Law Offices of Molly B. Kenny

Washington State Divorce and Retirement Accounts: Is your retirement money protected?

Molly B. Kenny
Founder and Principal Divorce Attorney

During a divorce, retirement accounts may be a large point of contention, especially in the case of a senior divorce in which a marriage ends after many years, potentially even decades. The retirement funds may be the most valuable asset up for division. You might have planned on living out your retirement years with your husband and even though those plans may not have worked out, you are still legally entitled to your share of your retirement funds. It is easy to forget about these funds in the mix of everything else, but the funds are necessary to help you save for retirement.

A divorce in Washington State could affect different types of retirement plans and funds, including the following:

  • IRAs and Roth IRAs
  • 401K plans and 403K plans
  • Employee Retirement Income Security Act (ERISA) funds
  • Pensions and military pensions
  • Employee stock options (ESOPS)
  • Keoghs


Remember, that your retirement funds are likely eligible for division in the case of a divorce, even if only one spouse has contributed to the fund. This is because Washington is a “community property” state. Both spouses are eligible to their share of the money in the funds.

How do you go about dividing retirement plans?

You may, for instance, divide your retirement accounts through equalization. In this process, you will simply retain one of the accounts in exchange for another asset of similar value. For instance, you may decide to keep a retirement account that is worth $20,000, and allow your spouse to retain a car of the same value. You could also take on a debt in exchange for your spouse giving up his or her rights to a fund.  

You can also decide to split down the private account into two equal shares. For example, if your fund is worth $20,000, then you may divide it equally between the two of you, amounting to $10,000 each.

These are simple options, but unfortunately, dividing retirement assets is usually a more challenging affair than normal asset division. Many retirement accounts cannot be equally divided at all, so there is no question of splitting up the account right down the middle.

(Note: Do not attempt to remove the money from your account before the division. You could be eligible for serious tax penalties.)

During the division process, when the fund was started and when the money was accrued (before, during, or after the marriage) will affect who gets what. 

You need strong legal guidance before you go ahead with the division of retirement assets. It is important to speak with a Washington divorce lawyer to understand the limitations involved in the division of these assets.

What are QDROs and how can they help me divide a retirement fund?

Most retirement funds in a divorce are divided using a Qualified Domestic Relations Order (QDRO). The QDRO will designate an alternate payee to the account. This payee has four main options for how to collect her portion of the funds.

Remember, a QDRO is a very serious document, and must be carefully drafted. Any errors made in the drafting of your document could mean financially disastrous consequences for you. Get help from a Washington family lawyer before you go ahead and use a QDRO to divide your retirement funds.

You cannot overestimate the need for caution and great care when you are dividing your retirement funds. It is imperative that you receive the share of the funds that you are legally entitled to because retirement funds constitute a significant part of your overall life savings.

Schedule a consultation with Washington state divorce attorney Molly B. Kenny, and discuss what to do with your retirement assets and how you can divide these in a manner that is fair to you. Call The Law Offices of Molly B. Kenny at 425-460-0550 or fill out the online form and schedule a consultation.