Am I Able to Take Money from My Retirement Account to Pay Debts During Divorce?

Am I Able to Take Money from My Retirement Account to Pay Debts During Divorce?

Dear Attorneys,

I need to hire a law firm for my divorce, and I just don’t have the funds in the bank right now. Is it okay to take the money from my retirement account? Would I also be able to take some additional money from my retirement to go towards some outstanding debts? My soon-to-be ex-spouse has left us with a lot of credit card debt, and I’d like to pay that down before the divorce is over.

Very Truly Yours,

Cash Is Tight

 

Dear Cash,

You can take money out of your retirement account for counsel fees, however you need to be careful about taking money out to pay down debt (marital or otherwise). While you are able to hire an attorney with funds from your retirement account, taking funds out to pay other debts or bills can sometimes cause issues, and it may be in violation of the Automatic Orders, which go into effect when your divorce is filed, but, may also apply on the “eve” of a divorce filing. We usually don’t recommend that our clients do this, but it may depend on your specific situation, so you should consult with an attorney, and potentially a financial advisor, before make a decision to do that.

If you need a confidential consultation we would be happy to meet with you. Please do not hesitate to contact us at 203.745.3151 or info@wolfandshorelaw.com.

Very Truly Yours,

Wolf & Shore Law Group

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