When a couple files for divorce, dividing up their 401(k) is one of the most complicated parts of property division. Do you have to split up your 401(k) evenly, or can you negotiate with your former spouse for a better deal? Here’s what you need to know about dividing a 401(k).
Do you have to divide up your 401(k) when you get divorced?
In some cases, you might be able to avoid dividing up your 401(k) during a divorce. You may be able to offer your spouse another asset in exchange, like a house or a vehicle. Additionally, if both individuals have a 401(k) with the same amount of savings, they might decide not to divide their 401(k)s.
However, if your spouse insists on taking part of your 401(k), you’ll have to divide up your 401(k) into two different accounts. You can also liquidate part of your 401(k) and pay your former spouse directly. You might have to pay penalties, but you can agree to hand over part of your 401(k) if your spouse pays the fees and penalties.
How can an attorney help a client who’s filing for divorce?
Hiring an attorney may make the divorce process easier and help divorcing individuals move on with their life as quickly as possible. An attorney might be able to act as a mediator who helps both parties negotiate without taking the matter to court. If the divorce does become a court battle, an attorney may represent their client throughout the trial and help them act in their own best interests.
A family law attorney may be able to help you deal with disputes over child custody, spousal support, property division and more. They might also help divide properties like 401(k)s, investments, savings accounts, insurance policies and pension plans.