On Talk Money today I will be discussing the ugly "D" word and the impact that Divorce has on retirement fund benefits.
Retirement Funds form part of one's estate subject to divorce proceedings. This means a spouse can make claim against a pension, provident, preservation funds and retirement annuities. Depending on the marital contracts namely "in community of property" or "out of community of property with accrual". This is not applicable to spouses married without accrual.
In order to lay a claim against a spouses retirement fund, a divorce order must be made in terms of Section 7(8) of The Divorce Act. This means that:
1. The court must award the non-member spouse a certain % of the members interest.
2. The retirement fund must be named or capable of being ascertained.
3. The retirement fund must be ordered to make an endorsement in its records to ensure that that the awarded part of the pension fund is paid to the non-member ex spouse.
