Military Retirement
One of the most difficult parts of a military divorce to navigate is retirement, for both the service member and spouse of the service member. The spouse of a service member, whether they’re divorced or not, gets a portion of the retirement plan from the military. However, the chief determiner as to whether a spouse gets a piece of that retirement fund is the length of the marriage. Determining whether they’ll get a piece of that portion of the retirement relies on a couple of different calculations that are used to determine whether the soon-to-be ex-spouse is entitled to that money at the end of their working years. The four calculations that make that determination involve the net present value, the deferred distribution, the reserved jurisdiction, and the point system. Each of those are calculated and weighed against each other in a different way.
The net present value is often used when a party wants a buyout at the time of the divorce for whatever funds are currently in the retirement fund. The deferred distribution would be a share that’s calculated at the time of the divorce, as in, based on the length of the marriage, the amount of retirement is calculated and distributed, but it will not be accessible until the time of retirement. However, reserved jurisdiction means that the court would end up deciding what portion of the retirement goes to each party at the time of the service member’s retirement. Lastly, there’s the point system, which is usually used if the service member was in the Reserves. In this instance the point system would function by counting the amount of points collected during the duration of the marriage, rather than the total length of the marriage. These points are different based on the type of service provided by the service member in question.
Within the parameters of retirement, there’s also the thrift savings plan, or a TSP, which is an investment plan that’s much like a 401k. Since it’s a savings account that relies on the growth of the investment over time, the amount that’s distributed between each usually corresponds with how the retirement plan will be distributed as well.