A look at retirement accounts and divorce in Kentucky

Every financial decision made when going through divorce in Kentucky is important because these decisions can impact a spouse's lifestyle, expenses and financial stability. A spouse should think things through and ensure that each decision will not have legal consequences. A divorcing spouse usually claims a share of different marital assets, such as marital homes, businesses, automobiles and bank accounts.

The retirement account of an ex-spouse is often overlooked during divorce proceedings. Considering that gray divorces are on the rise, retirement accounts are one of the assets subject to property division. However, some spouses disregard retirement assets in their divorce settlement or agreement. Based on a recent survey that examined more than 500 spouses who filed for divorce after 10 years or more of marriage, more than one-third of participants failed to claim a share in their spouse's retirement accounts. These respondents were also not aware that they could have included retirement assets in the asset division in the first place.

According to a report, retirement assets may qualify as a marital property in the event of divorce. If a spouse was married with money already in a retirement account or a 401(k), then that money is considered separate property and not included in the division. In equitable property states, such as Kentucky, marital properties are divided equitably between spouses meaning that the actual holder of the asset does not matter because it was obtained during the marriage and it is subject to division.

Many spouses want to obtain a fair share during property division. In order to reach a reasonable divorce settlement, retirement assets should always be taken into account. Having a Louisville legal professional who has thorough knowledge of every financial aspect of divorce may also prove invaluable.