No matter you prepared you feel you are going into your divorce proceedings in Georgia, the process will inevitably through you a few proverbial curveballs. One that many in your position are not anticipating is the division of their 401(k) accounts. While you may view this as a personal fund, contributions made to it during your marriage come from marital income. Thus, the court considers them to be marital assets.
Your retirement plans likely depend heavily on the funds you anticipate coming from your 401(k). This means that your divorce will have a drastic impact on those plans beyond just who you will spend those years with. Depending on how close you may be to retiring, you may want to try and minimize that impact as much as possible.
Keeping your full 401(k)
Typically in a divorce case, the court issues a Qualified Domestic Relations Order that authorizes your 401(k) plan sponsor to divide your account into two separate funds (with both you and your ex-spouse having control over your respective accounts). However, per the 401(k) Help Center, you can try to retain the full amount of your 401(k) by relinquishing your stake in another marital asset of equal value.
Determining whether it is worth it
Yet the decision to fight to keep your full 401(k) is not one you should rush into. When determining the value your ex-spouse foregoes in this situation, the court values their stake in your 401(k) at its potential future value (after years of potential growth). This may force you to give up more than you anticipate to retain your full account. The number of years until you reach retirement age should thus factor into your decision to seek to keep your full 401(k).