Military Divorce Guide: Everything You Need to Know about the Finances of a Military Divorce

Guide to Military Divorce

A typical divorce is always fraught with a certain level of emotional turmoil and financial angst, but a military divorce can be even more complicated. Service members and their spouses must know the specific laws (federal and state) that apply to their unique circumstances. Understanding the intricacies of dividing military pensions and retirement accounts can be extremely confusing and difficult for couples.

Consider some of the specific laws that pertain to military couples who are seeking to end their marriage. With some of these simple guidelines, you may find that you are entitled to a more favorable settlement than you thought.

Specific Military Divorce Laws

A military divorce is often more complicated than your usual divorce proceedings, because service members are protected by specific laws that do not apply to civilians. These extra security measures are designed to give members of the armed forces some peace of mind while they are busy defending their country. In particular, many of these military-specific laws and regulations will apply to active-duty members, or soldiers returning from an overseas deployment.

The most important law that should be noted by couples pursuing a military divorce is the Service Members Civil Relief Act. Under these statutes, service members cannot begin the divorce process (or be sued) while they are active-duty, or within sixty days of returning from an active-duty assignment.

Unfortunately, you may have to hold onto the marriage for a little while longer if you or your spouse are assigned to active duty. This situation can be emotionally strenuous for you or your spouse.

Additionally, service members may be subject to specific laws regarding their jurisdiction. In order to properly file, you must also know which court system will have jurisdiction over your divorce proceedings.

Therefore, now is a great time to educate yourself about the details involved in dividing retirement savings plans and pensions during a military divorce.

Where is Your Jurisdiction?

Civilians have a much easier time determining where they will need to file for the divorce, and deciding which court has jurisdiction over their split. Generally speaking, the jurisdiction is the location where one or both spouses maintain permanent residency. Military service members may have more difficulty in this area, particularly if they maintain a legal residence in an area other than the place where they are currently stationed.

Military couples often have several options about where they can file for divorce, based on the unique circumstances that come with being stationed in multiple locations. In general, you may file in the state where either spouse lives, where a service member is stationed, or you claim legal residency.

Take the time to talk with an attorney, and research which area will present you with more favorable divorce laws. Making the right decision about where to file could play a major role in allowing you to receive a more favorable divorce settlement. For instance, you may decide that it would be in your best interests to file in a state where you maintain legal residence, even if it is not where you currently reside.

However, a couple may quickly learn that there are many disadvantages to filing in a state other than the one you both live in. For instance, filing in a different state can be extremely time-consuming, because you will be required to travel back and forth for any necessary court hearings. There will be an additional cost associated with these travel arrangements, so be sure that the benefits are worth the extra work and the cost of travel.

Child Custody and Spousal Support in Military Divorce

Who will get custody of the children in a military divorce? This issue becomes significantly more complicated when one spouse is an active-duty service member, who may not be home as often as the other parent. The spouse who is not in the military is more likely to be granted full custody, because they can offer more stability for the children.

Unfortunately, service members may lose full custody of their children, and find themselves on the hook for larger child-support and spousal-support payments.

To make up for the lack of visitation and the greater burden of childcare, the non-military spouse may qualify for a larger child-support payment to offset the extra work and financial strain of raising children mostly on their own. This money could be used to help cover the cost of car payments or schooling for their children.

It can be especially crucial in situations when one spouse is forced to stay home with the children while the other is deployed. Service members often have many requirements on their time, which makes it difficult to maintain a two-income household. As a result, the stay-at-home parent could face more challenges when it comes to finding gainful employment to support their new family.

In these circumstances, spousal-support payments may be issued to help this spouse further their education or receive training. Ultimately, the goal is to assist them in obtaining a well-paying position that can help them better support their children. These support payments may have a specific end date, based on the overall goal or requirements to obtain a better-paying source of employment.

The 10/10/10 Rule

When discussing a military divorce, It is common to hear couples refer to the 10/10/10rule. The Uniformed Services Former Spouse Protection Act allows judges and the court system to view military retirement as a type of marital property under certain circumstances. This judgement can be a huge bonus for spouses who stayed at home during the marriage, and were unable to put money back into their own retirement savings accounts.

When this 10/10/10rule comes into play, you may have a much brighter financial outlook.

The requirements for the 10/10/10 rule are rather self-explanatory. You must be married for at least ten years, your spouse needs to have ten creditable service years in the armed forces, and those ten years must overlap. When these conditions are met, the payments will be directly made to the former spouse from the Defense Finance and Accounting Service (DFAS).

Some spouses may consider holding onto the marriage for a little while longer if they are close to the ten-year benchmark, which entitles them to a share in the retirement funds. This situation could present a significant financial advantage for you in the future, particularly if you were unable to start saving for retirement on your own during the course of the marriage.

Under other circumstances, a judge may still rule that a former spouse is entitled to a share of the military-pension funds. When these situations arise, the retiree would be held responsible for directly issuing the payments to the spouse themselves.

It should be noted that the 10/10/10 rule does not guarantee military spouses a specific amount of retirement funds. Your share will ultimately be decided by a judge, or by the state laws in the area where you file. When you decide where to file for divorce, laws regarding the division of assets like retirement accounts should be taken into consideration, particularly if you have multiple options for courts that have jurisdiction.

You may be eligible for up to half of the pension funds. However, some spouses prefer to accept a lower percentage of the retirement money, in exchange for a more valuable asset at the present moment. Dividing the marital home and other real estate may play a role in determining the exact percentage that each spouse will be awarded.

Under the 20/20/20 rule, a military spouse could also be eligible for continued benefits, such as TRICARE health insurance and base privileges. In terms of service commitment and the length of the marriage, you must meet a significantly greater requirement.

However, the requirements are fairly simple for these additional benefits:
* You must be married at least twenty years.
* The service member must have completed at least twenty years of creditable service.
* The twenty years of marriage and twenty years of service must overlap.

In addition to the time requirement for both the service and the length of the marriage, you must not remarry, in order to maintain these benefits. Base privileges and healthcare will both be revoked if a spouse remarries.

Understand the Intricacies of Military Divorce

Unlike a typical divorce, there are more rules and regulations regarding a military divorce. You and your spouse may find that there is an opportunity for a far more favorable settlement, because you have more options about where to file. However, there are also plenty of intricate laws (such as residency requirements, retirement-savings accounts, and child custody) to consider.

Be sure to assemble a team of divorce professionals that are extremely experienced at these types of divorces. You will want to hire a divorce attorney that specializes in military divorces in the area where you intend to file. A well-qualified attorney may come with a higher price tag, but it could be worth it if they are able to negotiate a more favorable settlement.

Similarly, a Certified Divorce Financial Analyst can help you plan for your financial future after a military divorce. They can assist you with the following tasks:

  • Formulating a new budget
  • Taking child support or spousal support into consideration
  • Managing all of the costs associated with maintaining your own household

All of these simple steps can help you maintain a brighter financial future.

Before you file, take the time to understand each of the intricate requirements associated with a military divorce. This preventative measure could make a significant difference in your financial future, particularly when it comes to dividing retirement savings accounts or pension funds.

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