What happens when a divorced military member retires on disability?

This is a difficult but not impossible situation. Let’s say the couple divorced while he was still on active duty. The property settlement called a division of retirement pay, but before it began he was injured and retired on a disability. Now the military spouse says that this will reduce her property settlement, and that’s just tough luck.

It may be tough luck, but not for the wife. Courts have tried to protect former spouses from what is called “divestiture” of marital property. The court may adjust the division of other property, including the former husband’s disposable retirement pay, in order to maintain the proportion of distribution.

Other courts have considered the reduction in disposable retirement pay to be what is called an “exceptional circumstance,” allowing the court to redistribute property after the divorce, sometimes years after the divorce.