One of the mistakes made most often by individuals going through the divorce process in Georgia is failing to determine a date of division for the 401(k) or other retirement account that is being equitably divided in the divorce. It is absolutely imperative to determine the date as of which to divide a retirement account in divorce because of the possibility that the account will fluctuate according to the market. Additionally, if the date of division is not settled prior to finalizing the divorce, it may be necessary for the ex-spouses to involve themselves in post-divorce litigation to settle this issue.
However, appreciating the necessity of determining a date of division is only half the battle. The real issue is determining when exactly the date of division will be. Should the retirement account be divided as of the date of separation, the date the divorce is finalized or some other date to be agreed upon by the parties? Although there is no set formula to determine what date of division is most appropriate, generally parties do not choose the date of separation as the date of division because in most divorce matters there is a significant amount of time between the date of separation and the date the divorce is finalized. Often, a date closer to the final date of divorce is chosen to ensure the account values will not be outdated when the time comes to actually divide the retirement account between the former spouses.