Zuba & Associates, P.C.

How can Illinois residents protect a 401(k) during divorce?

In a divorce settlement, a 401(k) retirement account could be considered joint property. With that being the case, the contributor to a 401(k) might stand to lose a substantial amount of money if a former spouse is given a portion of the fund. But for Rockford residents going through a divorce, there are steps you can take to ensure the assets in a 401(k) are protected.

Perhaps the easiest way to preserve individual assets is a prenuptial agreement, but many people may have foregone this document prior to a marriage. However, there are a couple of other ways people can preserve a 401(k) without a prenuptial agreement.

Individuals seeking to protect their 401(k) plans from being divided as marital property may want to consider cutting off contributions to the account as soon as the law allows. Divorces can take years to settle, and many people find themselves in unpleasant situations in which a former spouse is given access to 401(k) contributions that were made after the couple separated.

Another option is to exclude from a settlement the money that was contributed prior to the marriage. This action requires a detailed account of 401(k) records, and each divorce is financially specific. Still, it may be possible to exclude some 401(k) assets from the divorce settlement.

Taking the time to document 401(k) contributions prior to a marriage and being thorough during the division of property can make a big difference in divorce proceedings. Illinois residents with 401(k) concerns should be aware of every available option for protecting assets and limiting future debt obligations after a divorce.

Source: Huffington Post, "Divorce Questions: How Do I Protect My 401k In A Divorce?" Brittany Wong, May 25, 2012

No Comments

Leave a comment
Comment Information

How Can We Help You?

Email Us

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Zuba & Associates, P.C

Firm Location:
6067 Strathmoor Drive
Rockford, IL 61107

Phone: 815-315-9351
Fax: 815-397-1834
Rockford Law Office Map

Back To Top