Do divorce settlements include early retirement bonuses?
As more and more companies downsize, early retirement bonuses, severance payments and enhanced benefits need to be included in divorce settlements. The courts are divided on this issue. A divorce settlement which awarded a share of the husband’s retirement to the wife does not include an $83,000.00 voluntary separation incentive the husband later received for electing early retirement ruled the California Court of Appeals. The court reasoned that the payment did not accrue during the marriage. However, the Texas Court of Appeals ruled that a wife who was awarded a share of her husband’s retirement pay at divorce was entitled to an $87,000.00 bonus he accepted three years later for early retirement from the Air Force. The court reasoned that the bonus should be considered “retirement pay” since the husband accepted it in lieu of working more years and accumulating additional retirement benefits. Courts in Arizona, Colorado, Florida, Montana and Oklahoma have issued similar decisions. [t
Related Questions
- I understand that early retirement is age 55 with 5 years of service, however what if I would like to retire at age 62. Can I do that or can I only retire at ages 55 or 65?
- I want to retire before age 59. How do I avoid the 10% early distribution penalty on retirement payments from my 401k?
- What are the eligibility requirements for early age retirement?
