Dear Quentin, the writer of the letter, is a 61-year-old woman whose 51-year-old husband no longer wants to be married to her. She left her job in 2006 and used her 401(k) to pay off their debts. When she became disabled in 2012, she used her 401(k) for expenses as her husband was also unable to work due to a parasite behind his eye. She later sold her vehicles to pay off debts and is now only left with a mortgage and her husband’s car payment. They are now getting divorced after 20 years of marriage.
The husband wants to give the writer his 401(k) in exchange for their house, which is valued at $250,000. The writer is wondering if she is entitled to half of his 401(k), which is currently worth $275,000. She is considering using the money from his 401(k) to buy a house or as a down payment. The husband’s suggestion raises suspicions as it may not be in her best interest considering the circumstances of their divorce.
Wisconsin, where the couple resides, is a community property state, meaning all assets acquired during the marriage are considered community property and divided equally in a divorce. The writer should already be entitled to 50% of her husband’s 401(k) contributions made over the last 20 years. The settlement should also consider the tax implications of withdrawing from a 401(k) in a divorce, as well as any potential benefits or drawbacks of exchanging the 401(k) for the house.
The writer and her husband lived above their means and accumulated debt during their marriage, which may have contributed to their current financial situation. It is important for both parties to take accountability for their financial decisions. The husband’s choice to take out a credit card for an expensive engagement ring after the writer cashed out her 401(k) may have further strained their finances. The writer should consider seeking advice from legal and financial professionals to ensure a fair and equitable divorce settlement.
It is essential for the writer and her husband to resolve their financial issues amicably and cooperate in dividing their assets in a way that is fair and beneficial to both parties. The writer should prioritize her financial well-being and consider all options before making any decisions regarding the division of assets in the divorce. Seeking advice from legal experts and financial advisors can help the writer navigate the complexities of divorce and ensure a fair settlement that meets her needs and protects her financial future. The husband’s financial decisions should also be scrutinized to prevent further financial instability post-divorce.
