Spousal support, also called alimony, can play an important role in many Florida divorces. Florida follows equitable distribution principles, meaning the fair, though not necessarily equal, division of marital assets.
When spousal support comes into play, its impact on retirement accounts can be significant.
Retirement account division
Florida’s rate of 3.4 divorces per 1,000 people is one of the highest in the nation. Retirement accounts, such as 401(k)s and IRAs, are often marital assets subject to division upon divorce.
Florida law recognizes the contributions of both spouses during the marriage, and this extends to financial support and sacrifices both make for the benefit of the family. When one spouse gets support, it affects the distribution of these retirement funds.
Financial stability in retirement
Spouses paying alimony may become less able to contribute to their retirement accounts. This, in turn, may lead to an unbalanced distribution of retirement assets, potentially affecting the standard of living for both parties in their retirement.
Modification of spousal support
As circumstances change, so too can spousal support agreements. A modification in the amount or duration of alimony can impact the division of retirement accounts. A reduction in spousal support may provide the paying spouse with the opportunity to increase contributions to their retirement fund. Conversely, an increase in support may limit the resources available for retirement savings.
Considering the potential impact of spousal support on retirement account division is important during divorce proceedings. Understanding the financial implications and working toward a fair and equitable arrangement can help mitigate challenges in the post-divorce years.