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Military pensions and divorce: Separate fact from fiction

When you've separated from your spouse and are seeking a divorce, it's also important to separate fact from fiction where your military pension is concerned -- otherwise, you may end up making a serious mistake.

Here are some important facts that you should know:

1. Former spouses aren't automatically entitled to share your retirement pay.

The Uniformed Services Former Spouses' Protection Act (USFSPA), authorizes the state court to treat your retirement benefits as a marital asset, not income -- and it also allows the court to award your spouse some of those benefits. However, the award has to be in writing and part of your divorce decree. It isn't automatic.

2. Your spouse is probably not entitled to half of your pension.

Unless you were married your entire military career, your spouse probably isn't entitled to a full 50 percent of your military retirement.

Like other marital assets, the percentage of your pension that your former spouse is due is based on how much you earned during your actual marriage -- and there are vastly different ways to calculate that amount. Some of those ways are far more advantageous to you than others. For example, the coverture fraction formula is useful if the majority of your military service occurred prior to your marriage because it can exclude that service. However, using a fixed dollar amount to represent your ex-spouse's portion of the award almost always benefits you more because you get to keep the yearly cost of living increases that are added to your pension without splitting them.

3. Your spouse can bargain away his or her right to survivor benefits.

Survivor benefits plans provide a benefit to the ex-spouse for life, even after you die -- but only if they're elected. If you want to keep that significant benefit available for a future spouse, try to bargain with your ex for something that he or she wants more -- like another marital asset that may mean less to you.

Military divorces can be much more complicated than non-military divorces -- so make certain that you retain an attorney with experience in that field in order to best protect your interests.

Source: dfas.mil, "Frequently Asked Questions," accessed July 19, 2017

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