Q. Karen R., of Minnesota asks: How important is it to have a pension divided in a divorce?
A. Spencer, a Lead Pension Analyst at Pension Evaluators & QDROS Of Troyan, Inc Associates Group replies: "Pensions can, in many cases, form the largest asset in a divorce. Yes, in many cases, it can be worth more than the family home and a good family lawyer should make you aware of this and research the subject carefully with you. A pension could provide some bargaining power and enable you to reach a settlement. Having a pension can mean the difference between enjoying your retirement or being reduced to penury. It would mean the difference between independence and reliance on others. Advice should be sought about tax implications on tax effecting a pension as lump sums as they are not liable for tax but tax effecting could attract a tax offset 33 per cent or more. A pension is not his or hers but just another asset which has to go into the divorce pot for fair and equitable distribution, whether you do this voluntarily, through mediation, solicitors or the courts, you should always have good legal advice. The courts have wide powers to apportion pension rights and this should be considered when trying to come to an agreement."
Spencer Olsen,
Lead Pension Analyst