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Your safety and well-being are our top priorities. Our office is open and staffed to serve you. We are taking measures to ensure that our office is thoroughly cleaned and safe for our clients. We will continue to offer our services via phone, email, and Zoom. Harris & Literski is committed to slowing the spread of COVID-19 while continuing to be the law firm you can depend on.

Protecting Michigan 401(k) accounts with pre-nuptial agreements

| Jun 6, 2012 | Unmarried Couples |

For unmarried couples in Michigan who are considering marriage, a possible split-up is not likely the first thing that comes to mind when planning ahead. But despite what we like to believe, the future is often uncertain, and many couples would do well to establish a pre-nuptial agreement that protects assets and prevents possible debt burdens in the future.

Readers in the Ann Arbor area who have 401(k) accounts may want to address those assets in a pre-nuptial agreement. There may be a popular conception that pre-nuptial agreements are only for people who have high assets, but that isn’t necessarily so. No matter the amount of assets, property or debts a person has, a pre-nuptial agreement can delineate how those items will be treated should a marriage not work out. For instance, an agreement prior to the marriage can exclude a 401(k) from a possible divorce settlement.

When a 401(k) is not considered in a pre-nuptial agreement, the account may end up being divided if the couple divorces. In that case, the 401(k) may still be protected if the payer into the account stops contributing to it as soon as the law allows. Otherwise, payments made after a husband and wife decide to divorce could be regarded as marital property and thus divided.

Unmarried Michigan residents who are concerned about protecting their 401(k) plans will want to weigh the option of a pre-nuptial agreement. Such a document is a symbol of honesty and transparency for many married couples, and should they divorce, a pre-nuptial agreement can help make the division of property a relatively smooth and straightforward process.

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

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