Divorces among people over age 50, also known as gray divorces, have become increasingly common since the 1990s. People in Louisiana who have been married for a long time and perhaps have acquired substantial assets could encounter many issues when splitting their marital property. Retirement savings plans often raise questions about valuation, and distributions prior to age 59-1/2 could trigger taxes and penalties.

The specific rules governing the division of employer pensions vary. A financial professional will likely need to examine the terms of the plan and determine its current value. This process could take weeks or months. The value of a 401(k) might be easier to determine, but people should check to see if their former spouses have taken any loans out against the balances before making decisions about how to split the money. Both of these retirement plans also require a court order called a Qualified Domestic Relations Order before funds can be distributed to an ex-spouse. The court order could also enable someone below retirement age to avoid the 10 percent early withdrawal penalty. Tax law allows exemptions from the penalty under certain circumstances, such as someone buying a home after a divorce.

Annuities represent another form of retirement savings, but these financial products could lose significant value if cashed out early. Divorcing parties might need to address this during negotiations. The value might be preserved by leaving the annuity alone and relinquishing something else as part of the settlement agreement.

An equitable divorce settlement could be a high priority for a person nearing retirement. Legal representation might inform a client about rights to certain assets. An attorney could also manage negotiations about property division. This service could help the client avoid emotional confrontations and stay focused on long-term financial needs when making decisions.