Property division in Rhode Island is not just about deciding who keeps the house. It is not just about dividing personal property, such as furniture, artwork and other items, which may be valuable either financially or emotionally. It is also about splitting less tangible assets, such as retirement accounts and planning for one's financial future. Therefore, it is important before heading into the property division process to have an understanding about what you needs financially after divorce.
Unfortunately, one recent study conducted by Fidelity Investments reveals that spouses may not be 100 percent knowledgeable about their current retirement assets and financial status. For example, the study noted a disconnect between what each spouse thought they knew about their finances, compared to what they actually knew. Nearly 75 percent of the respondents surveyed believed they discussed finances with their spouse. Nonetheless, when it came to agreeing about what each spouse's Social Security retirement benefits would be, 60 percent of spouses did not agree with the answer given by their partners. Moreover, 40 percent of respondents surveyed could not even accurately report their partner's income.
The study also had some interesting findings regarding couples and their retirement. Fifty-one percent of couples surveyed had concerns about having enough in retirement savings to support themselves for the remainder of their lives. In addition, nearly 50 percent of respondents did not even know what they would require financially to maintain their current standard of living after retirement. Nevertheless, over 35 percent of respondents reported that they have not developed a financial plan for their retirement.
This lack of knowledge about finances can harm a person if he or she later divorces his or her spouse. Retirement accounts, like other assets in Rhode Island, will be split. This may ultimately affect one's retirement plans, since these plans may no longer include his or her ex's retirement assets. If one does not understand his or her financial situation is during his or her marriage, he or she may not be able to protect his or her financial interests when the marriage ends. Ultimately, it is important for individuals in Rhode Island to have a good grasp on what their financial needs will be during their lifetime post-divorce, in order for property division to be fair.
Source: Forbes, "Divorcing Women: How Much Do You Know About Your Husband's Retirement?," Jeff Landers, July 29, 2015