The end of a marriage can lead to a number of questions. What will happen to their house? How can they support their children? Will support payments be a part of their life as they move forward?
When one spouse has a career in the military, however, couples face additional questions. One important financial consideration is the fate of a servicemember’s military pension. What should divorcing people know about divorce and military pensions?
Pension benefits earned during a marriage are marital property.
Under the Uniformed Services Former Spouses Protection Act (USFSPA), military organizations recognize and enforce court orders regarding the divorce of servicemembers. One aspect of this law is that courts can divide military retired pay in a divorce settlement.
While each state handles this division differently, every state includes military pension earned during the marriage in marital property. As a result, courts will distribute these benefits between spouses in the same way that they would divide other property like a savings account. Spouses may be eligible to claim up to half of that retired pay.
The 10/10 rule outlines when someone can collect pension benefits directly.
The court can award a servicemember or veteran’s spouse a portion of their pension regardless of the length of their marriage. In many cases, the servicemember will be responsible for providing their former spouse with their portion of the pension in the same way that they would be responsible for other support payments.
In some cases, though, Defense Finance and Accounting Services (DFAS) will pay the former spouses of servicemembers directly for their portion of that pension. In order to qualify, couples must meet both criteria of what is known as the 10/10 rule:
- The couple must have been married for at least 10 years
- During their marriage, the servicemember engaged in at least 10 years of creditable military service
The 10/10 rule only affects how a spouse collects their share of the pension. If you do qualify, you will still need a court order or settlement in place that outlines the amount each spouse receives. Those who qualify may apply for direct payment through DFAS after their case resolves.
If you are uncertain whether the 10/10 rule applies in your divorce, you may want to seek insight from an attorney with experience navigating military divorces. They can help you determine whether direct payment will be an option in your divorce.
Divorce can lead to complex questions about your finances, especially when retirement benefits are a part of property division. Careful planning and experienced guidance can help you address those questions and create a strategy that supports your financial needs.