The Complete Guide to Divorce Financial Planning in Ohio

If you are going through a divorce in Ohio, or even just starting to think about it, I want you to know something right away: your financial future is not over. It is not ruined. And it is certainly not out of your control. What it is, honestly, is at a crossroads. And the decisions you make right now, during this transition, will shape your financial life for decades to come.

I say this as someone who has spent over a decade helping women navigate the financial complexities of divorce. As a Certified Divorce Financial Analyst, Master Analyst in Financial Forensics, and Accredited Financial Counselor, I have sat across the table from hundreds of women who walked in feeling overwhelmed and walked out feeling empowered. Not because their situations were easy, but because they finally understood what they were dealing with and had a plan.

This guide is designed to give you that same clarity. Whether you are in the early stages of considering divorce, in the middle of proceedings, or recently finalized your decree, this is the comprehensive resource I wish every woman in Ohio had before signing anything. If you want to start with the basics, our Preparation for Divorce Checklist is a great companion to this guide.

Why Divorce Financial Planning Is Different from Regular Financial Planning

Let me be direct: general financial planning and divorce financial planning are two very different disciplines. Your typical financial planner is trained to help you grow wealth over time, saving for retirement, investing for the future, building an estate. A divorce financial analyst, on the other hand, is trained to help you protect wealth during one of the most complex financial transactions of your life.

During a divorce, every single financial decision is interconnected. The house you keep (or don't), the retirement account you negotiate for, the spousal support terms you agree to, the tax implications of each settlement option: all of these pieces affect one another. And here is what most people don't realize: a settlement that looks fair on paper today can leave you financially vulnerable five, ten, or twenty years from now if you haven't modeled the long-term impact.

That is exactly what divorce financial planning does. It takes the settlement options on the table and projects them forward, so you can see what your financial life actually looks like under each scenario, not just today, but in retirement. If you are curious about what a CDFA brings to the table, I wrote about it in detail in our blog post, What Is a Certified Divorce Financial Analyst and How Do They Help?

Understanding Ohio's Equitable Distribution Framework

Ohio is an equitable distribution state. That is a legal term that gets misunderstood constantly, so let me clear it up: equitable does not mean equal. It means fair. And what a court considers "fair" depends on a wide range of factors specific to your marriage.

Under Ohio Revised Code Section 3105.171, the court starts with a presumption of equal division of marital property. However, if the court determines that an equal split would be inequitable, it has the discretion to divide assets differently. The factors the court considers include the duration of the marriage, each spouse's assets and liabilities, the desirability of awarding the family home to the custodial parent, the liquidity of assets being distributed, tax consequences, the cost of selling assets, any existing separation agreements, retirement benefits, and any other factors the court deems relevant.

This is where I see so many women get caught off guard. They assume that because Ohio starts with a presumption of equality, they will automatically get half. But the devil is in the details. A 401(k) worth $500,000 is not the same as a house worth $500,000. One is a pre-tax retirement asset that you will owe income tax on when you withdraw it. The other is a physical asset with maintenance costs, property taxes, and potential capital gains implications if you sell. Understanding the after-tax, after-cost value of every asset is critical to negotiating a truly equitable settlement.

Marital Property vs. Separate Property: Know the Difference

Before anything gets divided, Ohio courts must first classify property as either marital or separate. Getting this classification right is foundational to everything else in your settlement.

Marital property generally includes all real and personal property acquired by either spouse during the marriage, income earned during the marriage, retirement benefits accrued during the marriage, and any appreciation on separate property that resulted from the labor or investment contributions of either spouse during the marriage. Separate property, on the other hand, includes property owned before the marriage, inheritances received by one spouse (even during the marriage), gifts made to only one spouse, and passive income or appreciation on separate property that did not result from either spouse's efforts.

Here is the catch that trips people up: commingling. If you inherited $200,000 from your grandmother and deposited it into a joint account that you and your spouse both used for household expenses, that inheritance may have lost its separate property character. Ohio courts look at whether separate property has been so intertwined with marital property that it can no longer be traced or identified. This is one of the areas where my forensic financial analysis expertise becomes especially important, because tracing the origins and movement of funds to establish what should and shouldn't be on the table for division requires a detailed and methodical approach.

The Financial Discovery Process: What You Need to Gather

Ohio law requires both spouses to exchange complete and truthful financial information during divorce proceedings. This discovery process, governed by Ohio Civil Rules 26 through 37, is your opportunity to get a full picture of the marital estate. Do not skip this step, and do not take shortcuts.

At minimum, you should gather the following: at least three years of federal and state income tax returns, twelve months of bank statements for every account (checking, savings, money market), investment account statements (brokerage, mutual funds, stock certificates), retirement account statements (401(k), 403(b), IRA, Roth IRA, pension), real estate documents including mortgage statements, property tax bills, and appraisals, business financial statements and tax returns if either spouse is a business owner, credit card statements and loan documents for all debts, life insurance policies, Social Security statements for both spouses, employee benefit summaries, and any prenuptial or postnuptial agreements.

I always tell my clients: more documentation is better than less. If you are not sure whether something is relevant, gather it anyway. I would rather review a stack of documents and set some aside than discover a gap in the financial picture after the settlement is finalized. Our Divorce Checklist walks you through this step by step so nothing falls through the cracks.

Spousal Support in Ohio: What You Need to Know

Spousal support (what many people still call alimony) is one of the most emotionally charged aspects of divorce. In Ohio, it is governed by ORC Section 3105.18, and the court considers a long list of factors when determining whether support is appropriate, how much, and for how long.

Those factors include the income of both parties from all sources (including income from property awarded in the divorce), the relative earning abilities of each spouse, the ages and health conditions of both parties, the retirement benefits of each spouse, the duration of the marriage, whether it is appropriate for a custodial parent to work outside the home, the standard of living established during the marriage, each spouse's education level, the relative assets and liabilities of each party, each spouse's contribution to the other's education or earning ability, the time and expense needed for the lower-earning spouse to acquire education or training for appropriate employment, the tax consequences of support, and any income lost by either spouse due to marital responsibilities.

One thing that is especially important to understand right now: the tax treatment of spousal support at the federal level has changed. Under the Tax Cuts and Jobs Act of 2017, for divorce agreements executed after December 31, 2018, spousal support payments are no longer tax-deductible for the payor and are no longer taxable income for the recipient. There has been ongoing discussion about whether this provision might be revised as it was originally set to sunset, but as of now, the current rules apply. This change has significant implications for how support should be structured, and it is something I work through carefully with every client. For more on this topic, check out our blog post on Do Women Pay Alimony? which digs into common myths and realities of spousal support.

Also worth noting: Ohio courts can award temporary spousal support during the divorce proceedings, which is separate from any post-decree support order. If you are the lower-earning spouse and need financial assistance while the divorce is pending, don't wait to ask for it.

Dividing Retirement Accounts: The Most Complicated (and Most Important) Piece

For many of my clients, retirement accounts represent their single largest marital asset. And yet, I consistently see these accounts handled carelessly during divorce negotiations, either because the parties don't fully understand the rules or because they are trying to rush through the process.

Here is what you need to know. In Ohio, retirement benefits accrued during the marriage are marital property subject to equitable distribution. The marital portion of a retirement account is generally the value accumulated between the date of marriage and the date of the final hearing (or another date the court selects if it determines a different timeframe would be more equitable). Pre-marital contributions, along with their growth, are typically considered separate property.

Types of Retirement Accounts and How They Are Divided

Different retirement accounts have different division mechanisms. For employer-sponsored plans like 401(k)s, 403(b)s, and pensions covered by ERISA (the Employee Retirement Income Security Act), you will need a Qualified Domestic Relations Order, or QDRO, to divide the account. A QDRO is a specialized court order that directs the plan administrator to transfer a portion of the retirement benefit to the non-participant spouse. Without a QDRO, the plan administrator will not honor the division, regardless of what your divorce decree says. A separate QDRO is required for each plan being divided.

For Ohio public employee retirement plans (like OPERS, STRS, or SERS), the mechanism is a Division of Property Order, or DOPO, rather than a QDRO. These state plans have their own specific forms and requirements, and deviations from their prescribed format can result in the order being rejected.

For IRAs and Roth IRAs, which are not governed by ERISA, you don't need a QDRO. Instead, these accounts are typically divided through a transfer incident to divorce, which allows for a tax-free transfer between former spouses when properly documented in the divorce decree. I walk through the specifics of Roth IRAs in our blog post, What You Need to Know About a Roth IRA in a Divorce.

Federal military pensions, federal civil service retirement benefits, and railroad retirement benefits each have their own unique rules and forms as well. If any of these apply to your situation, work with a professional who understands these specific systems.

Common Mistakes with Retirement Division

The mistakes I see most frequently with retirement account division include failing to file the QDRO promptly after the divorce (I have seen cases where this was delayed for years, creating enormous complications), not accounting for survivor benefits in pension plans, not properly separating pre-marital contributions from marital contributions, and treating all retirement dollars as equal when they are not. A dollar in a Roth IRA is worth more than a dollar in a traditional 401(k) because of the tax treatment on withdrawal.

When I work with clients, I always model the after-tax value of every retirement asset so we can compare apples to apples. A $300,000 traditional 401(k) might only be worth $210,000 to $240,000 after federal and state income taxes on withdrawal, depending on your tax bracket. A $300,000 Roth IRA, by contrast, is worth exactly $300,000 because qualified withdrawals are tax-free. This distinction matters enormously in settlement negotiations.

The Family Home: Emotional Asset, Financial Decision

I have a saying that I share with nearly every client: "Don't let your emotional attachment to the house compromise your financial future."

The marital home is almost always the most emotionally significant asset in a divorce. And in Ohio, courts specifically consider whether awarding the home to the custodial parent would be desirable, which adds another layer of complexity. But wanting to keep the house and being able to afford to keep the house are two very different things.

Before you negotiate to keep the home, you need to answer several critical questions. Can you qualify for a mortgage refinance on your own income? Can you afford the monthly mortgage payment, property taxes, homeowner's insurance, and maintenance costs on a single income? What are the tax implications of eventually selling the home? What other assets would you need to give up to keep the house? And perhaps most importantly, does keeping the house align with your long-term financial goals, or does it just feel like the safe choice right now?

I have worked with many women who fought to keep the house during divorce negotiations, only to realize two or three years later that they were house-rich and cash-poor. The mortgage payment consumed so much of their monthly income that they couldn't save for retirement, build an emergency fund, or enjoy any quality of life. Sometimes the most empowering financial decision is to sell the house, split the equity, and start fresh in a home that fits your new financial reality.

Tax Implications You Cannot Afford to Ignore

Taxes are the silent third party in every divorce settlement. And in my experience, they are the most commonly overlooked factor in divorce negotiations. Here are the key tax considerations that every divorcing person in Ohio should understand.

Filing status is the first consideration. In the year you divorce, your filing status for the entire year is determined by your marital status on December 31. If your divorce is finalized by that date, you will file as either Single or Head of Household (if you qualify). This can have a significant impact on your tax bracket and the credits and deductions available to you.

Property transfers between spouses as part of a divorce settlement are generally not taxable events under IRC Section 1041. However, this does not mean there are no tax consequences. The receiving spouse takes on the transferring spouse's tax basis in the asset. So if your spouse transfers stock to you that was purchased for $50,000 and is now worth $200,000, you will owe capital gains tax on the $150,000 gain when you eventually sell. Understanding the embedded tax liability in every asset is essential.

Child-related tax benefits are another area of negotiation. The dependency exemption was eliminated under the Tax Cuts and Jobs Act, but the Child Tax Credit, Child and Dependent Care Credit, Earned Income Tax Credit, and Head of Household filing status are all still valuable. Your divorce decree or parenting agreement should specify which parent claims these benefits, and in many cases, parents alternate or split them between children.

Finally, don't overlook Ohio state tax implications. Ohio income tax, property tax, and municipal income taxes (which are common across Ohio cities and municipalities) all factor into your post-divorce financial picture.

Child Support: The Basics for Ohio Parents

Ohio uses a specific formula for calculating child support, based on both parents' gross incomes, the number of children, and other factors like health insurance costs, childcare expenses, and the parenting time arrangement. The Ohio Child Support Guidelines are established by statute and provide a worksheet that attorneys and courts use to calculate the presumptive amount of support.

What I want to emphasize here is that child support is designed to cover the basic needs of your children, but it doesn't cover everything. Extracurricular activities, private school tuition, college costs, unreimbursed medical expenses, and other child-related costs are often negotiated separately. I always encourage my clients to think beyond the basic child support number and negotiate provisions for these additional expenses as part of their overall settlement.

And here is something many parents don't realize: Ohio courts have the authority to order parents to contribute to their child's college expenses under certain circumstances. The court considers factors like each parent's financial capacity, whether college was a reasonable expectation during the marriage, and the child's own financial contributions. If college funding is important to you, address it during your divorce negotiations, not after. A well-crafted settlement agreement should include a specific framework for how college costs will be shared.

Building Your Post-Divorce Financial Plan

The settlement is only the beginning. What you do with your financial fresh start matters just as much as what you negotiate at the table. Here is the framework I use with every client I work with through Intentional Wealth Partners.

Step 1: Establish Your New Financial Baseline

Within the first 30 to 60 days after your divorce is finalized, you need a clear picture of your new financial reality. That means creating a comprehensive monthly budget based on your single income (plus any spousal or child support), updating all account titles and beneficiary designations, opening new individual bank and investment accounts if needed, and establishing or rebuilding your credit in your own name.

Step 2: Build Your Safety Net

If you don't have an emergency fund, building one is your first priority. I recommend three to six months of essential living expenses in a high-yield savings account. This is especially important during the transition period when unexpected expenses tend to surface.

Step 3: Address Insurance Gaps

Divorce often creates gaps in insurance coverage. You may need to obtain your own health insurance (if you were previously covered under your spouse's plan, COBRA provides temporary coverage but is expensive), secure adequate life insurance (especially if you are receiving spousal or child support, as your settlement should require your ex-spouse to maintain life insurance with you as beneficiary to protect those income streams), review your homeowner's or renter's insurance, and update auto insurance policies.

Step 4: Realign Your Retirement Strategy

Your retirement plan needs a complete overhaul after divorce. Your projected retirement income has likely changed dramatically. Work with a financial advisor who understands your full picture to recalculate how much you need to save, determine whether you are maximizing your 401(k) contributions, evaluate whether a Roth conversion strategy makes sense given your new tax situation, and ensure your investment allocation reflects your updated risk tolerance and time horizon. Our blog post on Post-Divorce Financial Planning: Reevaluating Investments covers this in depth.

Step 5: Update Your Estate Plan

This is one of the most overlooked steps after divorce. Ohio law automatically revokes will provisions that name your ex-spouse as a beneficiary or executor. However, it does not automatically update your revocable living trust, beneficiary designations on retirement accounts or life insurance policies, or payable-on-death designations on bank accounts. If you don't proactively update these documents, your assets could still pass to your ex-spouse. I have seen it happen, and it is entirely preventable.

Why Working with a CDFA Matters

I am obviously biased, but I say this based on what I have witnessed over more than a decade in this field: having a Certified Divorce Financial Analyst on your team can be the difference between a settlement that sets you up for success and one that slowly unravels over time.

A CDFA brings financial expertise to the divorce process that most family law attorneys (who are brilliant at the legal side) and most traditional financial planners (who are excellent at wealth accumulation) simply don't have. We specialize in the intersection of divorce law, tax planning, and long-term financial modeling. We can project what your life looks like financially at age 65, 70, and 80 under different settlement scenarios. We can identify hidden costs and tax traps that aren't obvious on the surface. We can help you understand whether a proposed settlement truly serves your long-term interests or just gets you through the next year.

When you combine that financial analysis with the expertise of a Master Analyst in Financial Forensics, you also get someone who can trace assets, identify hidden income, and ensure full financial transparency in the discovery process. If your spouse owns a business or has complex compensation structures (stock options, deferred compensation, restricted stock units), this forensic expertise is invaluable.

Your Next Steps

If you are facing divorce in Ohio, here is what I want you to take away from this guide.

First, understand that this is not just a legal process. It is a financial one. And the financial decisions will follow you for the rest of your life.

Second, get educated before you negotiate. The more you understand about Ohio's equitable distribution framework, the tax implications of different settlement structures, and the true value of the assets on the table, the more empowered you will be at the negotiation table.

Third, build the right team. You need a family law attorney, but you also need a financial professional who specializes in divorce. These are different skill sets, and you deserve both.

Fourth, think long-term. Every settlement decision should be evaluated not just for its immediate impact, but for what it means five, ten, and twenty years from now.

And finally, remember that this is a transition, not an ending. I have watched hundreds of women come through this process and build financial lives that are stronger, more intentional, and more aligned with their values than anything they had during their marriage.

That is the Intentional Money Method™ at work. It is not just about the numbers. It is about building a financial life that reflects who you are and where you are going.

Ready to Take Control of Your Financial Future?

If you are navigating divorce or preparing for one, you don't have to figure out the financial side alone. At Intentional Divorce Solutions, we offer divorce financial analysis, mediation, and coaching to help you move through this transition with clarity and confidence.

Schedule a complimentary call to discuss your situation and learn how we can support you:

➤  For divorce financial planning, mediation, and coaching: www.greatlakesdfs.com/services

➤  For post-divorce financial planning and investment management: www.intentionalwealthpartners.co

➤  Listen to the Intentional Divorce Insights podcast: www.greatlakesdfs.com/podcasts/intentional-divorce-insights

You deserve a financial plan that is built for your life, not your marriage. Let's build it together.

Disclaimer: This guide is provided for educational and informational purposes only and does not constitute legal, tax, or financial advice. Every divorce situation is unique, and you should consult with qualified professionals, including a family law attorney, a Certified Divorce Financial Analyst, and a tax advisor, before making any financial decisions related to your divorce. Leah Hadley is not a licensed attorney and does not provide legal advice.