Question:
If I was to get divorced, what rights would my wife have to my 401k? Is a 401k considered marital property?
Answer:
Your question is about your spouse’s right to your 401k.
Michigan, where I practice and where you are writing from, is a marital property state. This means that any property acquired during a marriage belongs to both parties. If you acquired your 401k during your marriage, your wife is entitled to portion of it, but only a fraction of the portion acquired while you were married. Your 401k will go into the “marital pot” along with any other assets or debts you have acquired during your marriage.
In divorce, everything is negotiable. If the marital estate is sizable, it is possible to offer your wife something else, in lieu of getting a portion of your 401k. This could save you time and money in the long run.
A 401k is split with what is called a Qualified Domestic Relations Order (QDRO). A QDRO lets the plan administrator know how to divide the value of the benefits you and your spouse are to receive. If your 401k is split, you may be able to take your share of the funds out of the account, penalty free, and invest them elsewhere. You should talk to your plan administrator before making any settlement involving your 401k.
Although I practice law in Michigan, I cannot give you legal advice without thoroughly reviewing your case. Do not rely on this information as establishing an attorney-client relationship. Contact an attorney immediately for assistance. Cordell & Cordell does represent clients in Michigan. Thank you for submitting your question.
Jill A. Duffy is an Associate Attorney in the Troy, Mich., office of Cordell & Cordell. She is licensed to practice in the state of Michigan. Ms. Duffy received her BA in Psychology and Spanish and graduated Magna Cum Laude from Oakland University. She received her Juris Doctor from Michigan State University College of Law and graduated Magna Cum Laude.
