You may feel prepared to tackle any topic that could come up during your divorce proceedings in Boston. Like many, however, you may end up feeling blindsided when confronted with the fact that you have to divide up your 401k with your ex-spouse.
While your 401k does come largely from your own individual efforts, the court considers those contributions made to it during your marriage as marital property. This then leads to the question of whether you keeping its full amount is an option.
Retaining your full 401k
Having to relinquish a portion of your 401k in your divorce could drastically impact your retirement plans (particularly if you are close to retirement). Thus one can understand your desire to retain its full amount. According to information shared by the 401k Help Center, you may be able to do just that. You simply would need to approach your ex-spouse with a deal to forego their portion of it in exchange for you giving up your claim to another marital asset. You should keep in mind, however, that the asset you have to relinquish has to be of comparable value.
Is fighting for your 401k in your best interests?
This is where the decision to fight for your full 401k becomes complex. The value of the contributions subject to division is the projection of what they could be when you retire, not their present value. That number may be easy to determine if you are close to retirement age, yet if you are not it becomes much harder to quantify. Ultimately you could end up having to give up much more than you bargained for in exchange for the right to keep your entire 401k.