Going into your divorce proceedings in Georgia, you may feel as though you know everything the process entails. Such was the assumption of many of our past clients here at the Ordway Law Group, LLC. Yet just as they were, you may find it surprising to discover that your 401(k) is subject to marital property division.
A closer review of the origin of a portion of those funds explains why. Contributions made to your 401(k) during your marriage come from marital income. For this reason, the court views those contributions as marital assets. Yet that knowledge likely does little to mitigate your fears of how having to divide up your account might impact your retirement plans. Thus, you may want to know if keeping your full account is an option.
Fighting for your full 401(k)
According to information shared by the 401(k) Help Center, you may be able to keep your full account in your divorce. Doing so, however, requires that your ex-spouse relinquish their interest in it. That will likely require that you give up your claim to another marital asset in exchange. This may seem like a small sacrifice to keep your retirement plans intact, yet there are potential drawbacks to consider.
Determining your best course of action
The court values retirement assets not at their current value, but rather at their potential future value (after potentially years of additional gains through investment returns and earned interest). This means that in order to keep your full account, you may have to give up much more now than you realize (such as your interest in your marital home). Such a sacrifice warrants consideration before committing to any particular course of action.
You can find more information on dividing up your marital assets throughout our site.