When it comes to dealing with retirement issues regarding spousal support, it could be crucial to understand what the case of In the Marriage of Olsen (1993) 14 Cal.App.4th 1 stands for. In Olsen, the California Appellate Court stated that the trial courts have broad discretion to consider unwithdrawn retirement contributions and accruals as available for the setting of spousal support.
However, the justices in Olsen admonished that the trial court must give consideration to the dual but possibly conflicting public policies of awarding spousal support where appropriate and of encouraging citizens to save for their retirement. The Olsen court concluded that trial courts possess broad discretion when setting or modifying permanent spousal support about whether to consider as income contributions to individual retirement plans and accruals not withdrawn. The Olsen court stated it is easy to foresee cases where contributions and accruals are best not considered as income available to pay permanent spousal support.
In the case of In Re Marriage of Reynolds (1998) 63 Cal.App.4th 1373, the court held that a payor husband who had reached the retirement age of 65 and was between 59½ and 70½ during which time he could withdraw funds from his IRA without penalty, could only consider investment income, not investment principal, as available to pay spousal support.