Many households only have one spouse that works. Even in households where both adults have their own jobs, it is common for one adult to devote more to their career and the other to devote more to the family.
The spouse who focuses on the family gives up earning potential and career advancement opportunities to be with the children and take care of their family home. Those sacrifices benefit the entire family but leave that spouse at a major disadvantage should the couple ever decide to divorce.
Dependent or lower-earning spouses often feel trapped in miserable marriages because they don’t understand what rights they have when it comes to retirement savings. What can a dependent or lower-earning spouse expect regarding their retirement years?
They may have a right to retirement funds
The community property distribution rules applied to marital assets give both spouses an interest in shared marital property even if the actual asset is only in the name of one spouse. Retirement accounts and pensions that belong to one spouse on paper will be at least partially part of the marital estate.
Whatever the worker or their employer contributed to the account during the marriage will be subject to division in the divorce proceedings. The dependent spouse can either ask the courts to divide a retirement savings account or possibly award them a portion of the pension their spouse will receive.
They can get Social Security retirement benefits
Technically, Social Security retirement benefits directly correlate to someone’s payroll contributions during their career. However, the Social Security Administration (SSA) has a special rule for dependent or lower-earning spouses after a divorce.
Someone who did not accrue retirement benefits due to part-time or sporadic employment can qualify for benefits based on their spouse’s employment. Those who have partial or low benefits can supplement what they receive from the SSA with benefits based on their spouse’s income during the marriage. What a dependent spouse claims in retirement benefits from the SSA will typically not diminish the benefit rights of the other spouse.
Although it can be frightening to think about ending a long-term marriage when one has limited personal assets, the law does help those separating in unfavorable circumstances fend for themselves. Learning more about property division rules can help those contemplating divorce feel more confident in their final decision.