Will my pension be affected by my New Hampshire divorce?
Yes. New Hampshire law defines the different kinds of property that are subject to a divorce property settlement. All tangible and intangible property that belongs to either or both of the spouses is subject to a property settlement. The law says that "vested and non-vested pension or other retirement benefits" are a kind of intangible property. This means that pensions have to be divided like any other kind of asset.
Is there any way I can keep my pension all for myself?
It's possible. First, if your pension is entirely separate property (for example, you earned it entirely before the marriage and it gained no value during the marriage) then it should be awarded to you alone. Second, if the pension is subject to division because it's marital property (or a combination of marital and separate), then you and your spouse can negotiate a property settlement and present your agreement to the court for approval. If you are willing to give up something of comparable value, your spouse may be willing to allow you to keep all of your pension. The key is that both of you need to approach the situation with an open mind.
If you and your spouse can't agree on a fair settlement, you'll have to go to trial and it will be up to the judge to decide how to divide your property. If that happens, the odds of you keeping all of your pension will be greatly diminished. It's always best to settle a case yourself. That way, you retain control of the outcome instead of yielding it to a judge who doesn't know your financial situation nearly as well as you do.
My spouse and I can't agree on a settlement, and we have to go to trial. How will the judge decide to divide our property?
New Hampshire law requires that a divorce decree (a final order) contain an equitable property settlement. An equal division of the assets is presumed to be equitable unless the judge examines the following factors and decides otherwise:
- the duration of the marriage
- the age, health, social or economic status, occupation, vocational skills, employability, separate property, amount and sources of income, needs and liabilities of each party
- the opportunity of each party for future acquisition of capital assets and income
- the ability of the custodial parent, if any, to engage in gainful employment without substantially interfering with the interests of any minor children in his or her custody
- the need of the custodial parent, if any, to occupy or own the marital residence and to use or own its household effects
- the actions of either party during the marriage which contributed to the growth or diminution in value of property owned by either or both of the parties
- whether there's a significant disparity between the parties in relation to contributions to the marriage, including contributions to the care and education of the children and the care and management of the home
- any direct or indirect contribution made by one party to help educate or develop the career or employability of the other party and any interruption of either party's education or personal career opportunities for the benefit of the other's career or for the benefit of the parties' marriage or children
- the expectation of pension or retirement rights acquired prior to or during the marriage
- the tax consequences for each party
- the value of property that is allocated by a valid prenuptial contract made in good faith by the parties
- the fault of either party, if it caused the breakdown of the marriage, and also caused substantial physical or mental pain and suffering or resulted in substantial economic loss to the marital estate or the injured party
- the value of any property acquired prior to the marriage and property acquired in exchange for property acquired prior to the marriage
- the value of any property acquired by gift or inheritance, and
- any other factor the court deems relevant.
The judge will listen to testimony and receive exhibits, like bank statements or other documents. The court will also accept expert testimony to help decide the value of each asset. Then the judge will issue a written decision explaining the property division.
How much of my pension is at stake?
New Hampshire case law indicates that everything a spouse contributes to a retirement account during the marriage and up to the date of the final divorce decree is marital property that has to be divided equitably.
If your pension is subject to equitable distribution, New Hampshire courts will apply "the Hodgins formula" to decide what share should go to your spouse. A formula has to be used because it's impossible to know what the actual and contingent values of the pension will be. The formula is complicated, but it takes into account the amount of time worked, the length of the marriage, the actual benefits available, and the percentage of marital share each spouse takes in the final property settlement.
This can be a fairly complicated analysis, so if you have questions, you should contact an experienced family law attorney for help.
Are monthly pension benefits considered when setting alimony?
If you're collecting benefits, the court can consider that income when it decides whether and how much alimony to award your spouse.
I'm getting a disability retirement, which my former employer calls a "pension." Does this have to be divided?
It depends. The New Hampshire courts have decided that the words used to describe this kind of benefit aren't helpful, and that this question has to be resolved by looking at the character of the benefits. If you prove in court that the benefits you're getting are intended only to compensate you for pain and suffering and loss of earning capacity, then they're true disability benefits and they belong to you; they're not part of the "marital estate" that has to be divided equitably, and a judge won't divide them just because your employer labels them as a pension.
On the other hand, if your spouse proves that your benefits are more in the nature of a retirement, then the judge will divide them equitably.
My military pension hasn't vested. Is it subject to division in divorce?
Yes. It doesn't matter whether a pension is vested or whether it's been earned through military service. Both spouses are entitled to an equitable share. For more information on the division of military pensions in divorce, see Understanding the Division of Military Pensions in Divorce, by Janet Kosid Uthe.
