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Protecting a 401k during a divorce

New Jersey couples looking to divorce likely have an ever-growing series of questions and issues to which they seek resolution. While the question of staying together may have been definitively answered, several other questions linger: Who gets the house? Who gets the dog? What about my retirement? What about my business interests?

New Jersey couples going through a divorce may rightly be concerned about the property division aspect of the divorce process. One financial aspect that may not immediately come to mind is one's 401k. While the easiest way to protect assets is to have a prenuptial agreement, many New Jersey couples may not have one. A prenuptial agreement is a practical way to spell out exactly how to handle finances during a marriage and also in the event of a divorce. However, for those who do not have a prenuptial agreement, there are still other things that can be done to ensure the 401k is protected.

One of the most important things to consider while attempting to protect a 401k in the event of a divorce is to stop all voluntary contributions as soon as possible. While rarely does an individual in New Jersey or elsewhere want to think about the end of their marriage, at the first sign of trouble, it may be beneficial to take action.

A divorce can be a lengthy process and many people have been extremely unhappy about contributions made after a separation that were still considered during the property distribution process of their divorce. Seeking outside assistance can aid in this process to ensure all family laws are properly adhered in the protecting of a divorcing individual's 401k.

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

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