Divorce law in Illinois is largely written for couples with two working adults who may have children.  Illinois divorce law doesn’t explicitly consider retirement and divorce.  But, many principles can be derived from the statutes and case law so that your retirement can be minimally effected by your divorce and vice versa.

The financial aspects of a Chicago, Illinois divorce are determined by two factors: 1) the assets of the parties and 2) the incomes of the parties.

When one of the parties retires or prepares for retirement a significant change will happen to their income and even their assets as they begin to draw them down.

In an Illinois divorce, Assets get divided in that marital assets are divided equitably. Income can be used to establish that the higher earning spouse pay maintenance to the lower earning spouse…so long as that higher earing spouse is working.

When determining maintenance the court considers a variety of “factors including the needs of both parties (see 750 ILCS 5/504(a)(2) (West 2016)); the standard of living established during the marriage (see id. § 504(a)(7)); the income and property of each party and the debt obligations assigned to each party in the dissolution judgment (see id. §§ 504(a)(1), 510(a-5)(6)); the duration of the marriage (see id. § 504(a)(8)); the age, health, and employment capability of the parties (see id. § 504(a)(3), (5), (9)); and the tax consequences of ordering maintenance (see id. § 510(a-5)(4)).” In Re Marriage of Harms and Parker, 2018 IL App (5th) 160472.

It is obvious that retirement or pending retirement can effect each of the above factors as the court decides on maintenance issues in a case.

The retiring party, if over 65, is typically not held to an obligation to work. My experience is that most judges are in their 60s and they, themselves, are looking forward to retirement and therefore sympathize with the retiring party at least in as much as that the court won’t force them to keep working.

A retired spouse’s assets may generate income that could possibly be considered for maintenance purposes. Yet, it is difficult to imagine that those assets wouldn’t have been equally divided thereby giving the other spouse their own equal stream of income and thus making that spouse ineligible for maintenance.

Upon retirement of either party, either party may file a motion to modify maintenance as this constitutes “a showing of a substantial change in circumstances” pursuant to 750 ILCS 510(a)(1).

This means that the retiring spouse could ask that they pay less maintenance or, if the retiring spouse is the party receiving maintenance, they could ask for more maintenance upon retirement.

This is the danger of marrying a much older person. You could be in the prime of your earning potential and have to pay maintenance to someone who has no obligation to work and thus reduce your maintenance payment.

Of course all maintenance awards except for permanent maintenance have an expiration date pursuant to 750 ILCS 504(b-1)(1)(B). The obligation always ends on this date no matter how much it is needed.

The last item to be considered in retirement is the social security that the retiree will receive.
If the retiree is receiving maintenance, they can use the retiree’s social security benefits to reduce their obligation pursuant to 750 ILCS 504(b-1)(1)(A).

If the retiree is paying maintenance they can use the retiree’s social security benefits to increase the maintenance obligation pursuant to 750 ILCS 504(b-1)(1)(A).

Both of these calculations rely on the statute use of the term “gross income.” Most judges determine that income is something which is taxable, therefore, money received from social security may be considered not income because it is not taxable. This interpretation of income is, as of today, undetermined by the Illinois appellate or supreme courts.

The one thing you definitely cannot do is garnish someone else’s social security benefit. This is forbidden by federal law 42 U.S. Code Sec. 407. The good news is that if you were married to a high earning spouse for over 10 years, your own social security is likely to be augmented by their earnings.

In practicing law for over 12 years in Chicago, Illinois, I have noticed that judges have seen it all and do not dismiss people with no retirement savings or pay special attention to those with more than $ 10 million in assets.  The law is applied equally and with care to all parties in Cook County.  The system is slow but it is fair.  Your lawyer’s job is to make sure the judge is fully informed as to the facts and numbers so the fairest judgment can be entered.

Contact my Chicago, Illinois office today for a free consultation with a Chicago Divorce lawyer to learn how a retirement can affect your divorce.