When your kids leave for college and you’re facing divorce later in life, the financial uncertainty can be overwhelming. As a public school teacher in Minnesota, your teacher pension may not be your first concern, but it should be one of the most important things you have to think about.
Many educators going through a “gray divorce” (a divorce that occurs later in life, often after children have grown up and left home) are surprised to learn that their TRA ( Teachers Retirement Association) pension counts as marital property. If you earned your pension during your marriage, the court may decide to divide it. The court will treat it like any other asset, such as your home or savings.
That is why it is important to understand how divorce affects pensions and what the courts will do with them.
Your pension can be divided after a divorce
In Minnesota, judges follow equitable distribution laws. They divide marital assets fairly, but not necessarily equally. If you earned all or part of your teacher pension during your marriage, the judge may award your spouse a share of that pension.
Judges usually issue a Qualified Domestic Relations Order (QDRO), allowing your former partner to receive part of the pension you earned during the marriage.
That is why it is important to understand the true value of your pension before making any decisions during divorce.
Why your pension matters
Here is why your Minnesota teacher pension is so important:
- Pension payments provide long-term stability: These payments often outlast other assets and establish a steady income in retirement
- Cost of living adjustments (COLA) increase your monthly payments over time: They help protect you from inflation
- Survivor benefits offer added security: The benefits would be helpful, especially if your former partner passes away
- Waived pension rights risks your financial stability: Waiving your right to pensions can leave you financially vulnerable when you eventually retire
If you’re a teacher in Lakeville or anywhere else in Minnesota, it is essential to understand how your teacher pension fits into your divorce settlement. This helps guarantee you that you receive a fair share of the pension you have earned and has a lasting impact on your financial future. Knowing its value is just the beginning; now you need steps to protect it.
Protecting what you have earned
To protect your financial future, here are some essential steps you can take:
- Get a pension valuation: Understanding its value helps you make better decisions about your divorce settlement
- Work with professionals: Professionals experienced in handling public employee divorces may be able to advise you on your next steps
- Think about the long term: Prioritize your retirement as much as your immediate needs
Once you have taken these important steps, you should consider legal guidance. An attorney may be able to fight for your rights in a divorce and protect your retirement plan.
Whether you’re a teacher or not, your pension is an important asset. If you’re facing a divorce, know that there are ways to protect your benefits.