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Dividing it up in divorce

July 2, 2012 • J.J. Montanaro

Q: My hus­band and I are going through a divorce. We are both civil­ian gov­ern­ment employ­ees and he is in the Air National Guard. I cur­rently have $30k more in my Thrift Sav­ings Plan (TSP) than him. He wants $15k of my TSP and then I would get part of his mil­i­tary retire­ment. Or his other option to me is I can keep my TSP the same and then he can keep his TSP and mil­i­tary retire­ment. We have been mar­ried for 15 years, I don’t believe either of these are a “fair” option. My big ques­tion is, if he is con­sid­er­ing the TSP as an asset, isn’t the mil­i­tary retire­ment also an asset? If he is com­bin­ing the assets then the mil­i­tary retire­ment needs to be included also, right?

–Erin, Stans­bury Park, Utah

A: Although, we’re always happy to get ques­tions here at Ask June, I’d highly encour­age you to make sure you’re pos­ing this type of ques­tion to your attor­ney. When it comes to a divorce, both mil­i­tary retire­ment and the TSP are assets that can be divided by the decree. I’m not sure what’s fair in your par­tic­u­lar sit­u­a­tion, that’s some­thing you and your lawyer should hash out.

I would say that if you were to split things equally (not nec­es­sar­ily the same thing as “fair”), you would both end up with TSP accounts of equiv­a­lent value and the mil­i­tary retire­ment would be split so you received half the ben­e­fit earned dur­ing the time period that your husband’s ser­vice and your mar­riage over­lapped. If you can’t do it your­self, a finan­cial plan­ner can help you put a price tag on your poten­tial share and the over­all value of the mil­i­tary retire­ment. It could be that the mil­i­tary retire­ment is worth more than you think!

So, bust out your time value of money cal­cu­la­tor or find some­one who can and then work with your attor­ney to find a equi­table solu­tion. Good luck!  

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2 responses to “Dividing it up in divorce”

  1. CleoBarker
    July 3, 2012 at 5:50 pm |

    I think its com­plete bull that TSP is even on the table when it comes to divorce… You should both keep your own since its YOUR retire­ment money and you should right­fully get what you put into it. Thats just me though I guess. :(

  2. RetiredMSGT
    July 3, 2012 at 6:32 pm |

    If you get half of his retire­ment, will he get half of your retire­ment when the time comes? You didn’t indi­cate if you have a retire­ment plan at your work.

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