How the Mississippi judge divides the retirement nest egg
If spouses are unable to agree on how to divide retirement benefits in a Mississippi divorce, then the job falls to the chancellor. Retirement benefits are no different than other property in a divorce. Essentially, there are three steps.
- Determine the character of the property;
- Determine the value of the property; and
- Determine how to divide the property.
Let's take each of these steps separately.
The first step is determining the character of the property. That is, whether the property is marital, non-marital property, or combined. The easy one is where all the benefits were earned while the parties were married. In that case, the retirement benefits are marital property. In contrast, those retirement benefits which were earned while the working spouse was single are non-marital. The more difficult case is where the spouse earned part of the benefits while single and part while married.
Here is an example--a Madison, Mississippi man works for an employer in Ridgeland, Mississippi. He started working for the employer three years before he married. After six years of marriage, the spouses want to divorce.
In this case, the retirement benefits accrued involve both non-martial assets (the 3 years prior to marriage) and martial assets (the benefits earned while married). At first blush, the characterization is fairly easy--1/3 non-martial and 2/3 martial. However, how do you classify and value the increase in value of the non-marital benefits during the marriage? Is the increase in value non-marital or marital and how can you trace the specific increase in value since the benefits, both non-marital and martial, are commingled in a single account. In Mississippi, there is no clear answer to these questions and there are valid arguments to be made on each issue.
In my next post, I will discuss the next steps in the process.
