401K in Divorce: A Tip That Can Save You Thousands

Unfortunately, going through a divorce leads many people completely cash-strapped. While not ideal, if you have not built up enough liquid savings, you might be considering a withdrawal from a 401K. Here is an important tip you need to know about a 401K in divorce. This only works if you are awarded all or part of your spouse's 401K. It does not work on your own.

401K and divorce

Your Spouse's 401K in Divorce

When you file the Qualified Domestic Relations Order (QDRO) to have all or part of your former spouse’s 401K distributed to you, you have an opportunity to take cash out of the account without paying the IRS’s 10% penalty (on funds withdrawn before age 59.5). To take advantage of this, when dividing a 401K in divorce, have the portion you need, paid directly from the account to you.

Related post: QDRO: I need a what??

Related post: Should I leave my Ex's retirement as is?

It does not need to be the full amount that you are receiving.  Do not roll it into an IRA and...

Continue Reading...

How To Calculate Ohio Child Support

UPDATE: OHIO IMPLEMENTED NEW CHILD SUPPORT GUIDELINES ON MARCH 28, 2019. THE RESOURCES BELOW REFLECT THESE CHANGES.

For those who have minor children at the time of a divorce, one party or the other will likely be paying child support (unless they genuinely share parenting 50/50 and make about the same amount of money). Child support is paid until the child reaches age 18 or graduates from high school, whichever happens last. There is some gray area when it comes to how to calculate child support in Ohio.

Why Calculating Ohio Child Support is Not Black and White

Many people think that Child Support calculations are black and white. In some cases, that may be. However, there are many cases in which the calculation can be a little more complicated. The State of Ohio offers worksheets as well as a manual for how to determine the appropriate inputs for the calculations. Links to the resources are below.

At the most basic level, child support is calculated based on the combined...

Continue Reading...

QDRO: I need a what??

what does QDRO stand for anyway?

QDRO stands for Qualified Domestic Relations Order. If part of your divorce settlement includes a division of retirement assets held with a current or former employer, you may need a QDRO (Qualified Domestic Relations Order) or similar document, depending on the retirement plan. A QDRO is a document that gets filed with the plan administrator that tells the plan how the account will be divided.

A Costly Mistake

One of the mistakes that I see people make when dividing assets, is simply dividing each account down the middle. Seems like it would be fair, right? While it might be fair, it may also cause you to incur more costs than you would, if you were a little more creative about your settlement.

There are a couple of costs to consider. There is a cost to having someone draft the QDRO, which generally ranges from $450-$1000. Additionally, each plan charges an administrative fee on their side as well. That fee generally...

Continue Reading...

Valuing a Pension for Divorce is a Wise Investment

Are you losing thousands of dollars because of your financial fears during your dissolution or divorce?

The cost of the divorce itself is one of the biggest fears I hear from clients. There is no question. It will generally take longer and cost more than you expected. However, that does not mean it's a good idea to cut corners.

Valuing a pension for divorce: Don't cut corners

One frequent corner cut is a pension valuation. Pension valuations do not take a lot of time. However, they do require you to work with someone other than your attorney. Thus, even when recommended by their attorneys, many clients choose not to have them done.

It is not even necessary to meet with your valuation expert in person. All required information can be provided via phone/email. In some cases, the attorney can even provide all of the relevant information. I recognize that it can feel stressful and overwhelming to work with yet another professional and have yet another bill to pay. However, it could...

Continue Reading...
1 2 3 4 5 6 7 8
Close

Stay connected with our latest news and resources

Your privacy is important us. We promise we will not share your information with anyone.