What effect will a prenuptial agreement have on a 401(k)?

By Denise Appleby AAA
A:



Courts have ruled that a prenuptial agreement for qualified plan (including 401(k)) assets is invalid. The logic is that only a spouse can give up the rights to spousal benefits. When someone signs a prenuptial agreement, that person is not considered a spouse at the time of signing. Where couples agree that the spouse will not make any claim to the assets, it is often recommended that :






  • A postnuptial agreement be signed immediately after marriage

The spouse sign a beneficiary designation form giving up rights to the assets immediately after marriage.



The document be notarized or witnessed by a plan representative.



To learn more, read Marriage, Divorce And The Dotted Line and Create A Pain-Free Postnuptial Agreement.



RELATED FAQS

  1. Is a 408 (k) the same as a Simplified Employee Pension (SEP)?

    Find out the differences and the similarities between a 408(k) retirement plan and a simplified employee pension (SEP), and ...
  2. What are the 403(b) contribution limits?

    Determine whether 403(b) contributions meet federal guidelines. Contribution limits to this retirement plan are determined ...
  3. Can I roll over a 403b plan?

    Learn whether distributions from a 403(b) plan can be rolled over, where they can be rolled over to and what the income tax ...
  4. What is a 401(k) rollover?

    Find out what a 401(k) rollover is, when you might want to roll over a 401(k) and whether a direct or indirect rollover is ...
RELATED TERMS
  1. Elder Care

    Elder care, sometimes called elderly care, refers to services ...
  2. Eligible Transfer

    An IRS-allowed movement of assets into or out of an individual ...
  3. Leveraged Benefits

    The use – by a business owner or professional practitioner – ...
  4. Peri-Retirement

    A term for the period of time leading up to actual retirement. ...
  5. MyRA

    A new tax-advantaged retirement account that President Barack ...
  6. Target-Date Fund

    A mutual fund in the hybrid category that automatically resets ...
comments powered by Disqus
Related Articles
  1. Top Financial Frights: Emergencies & ...
    Investing Basics

    Top Financial Frights: Emergencies & ...

  2. Steps To Retiring With A Reverse Mortgage
    Retirement

    Steps To Retiring With A Reverse Mortgage

  3. When Your Job Offers An Awful Retirement ...
    Retirement

    When Your Job Offers An Awful Retirement ...

  4. Top 5 Strategies To Pay For Elder Care
    Retirement

    Top 5 Strategies To Pay For Elder Care

  5. 5 Top Alternatives To A Reverse Mortgage
    Retirement

    5 Top Alternatives To A Reverse Mortgage

Trading Center