Retirement savings accumulated during a marriage, particularly those held in defined contribution plans, are often subject to division in community property states. California law designates assets acquired from the date of marriage to the date of separation as community property, potentially including funds within these retirement accounts. For example, contributions made to a retirement account during the marriage are generally considered community property, even if only one spouse was employed and contributing.
The equitable distribution of marital assets ensures fairness during dissolution proceedings. Retirement funds represent a significant portion of many individuals’ net worth, making their proper valuation and allocation crucial. The historical context reveals a gradual shift towards recognizing the contributions, both financial and non-financial, of each spouse to the accumulation of wealth during the marriage, thereby necessitating a fair division of retirement savings.