I am 72 years old and just retired. I have a 401K that I just cashed in the last two weeks. The money is sitting in the bank waiting for me to decide what to do with it (i.e. roll it in to an IRA or something else). I have concerns about what to do with this money as I do not want creditors to be able to attach it and I don't want my current wife to be able to take it from me should she file for divorce. I also don't want to have to cash it out and pay a huge amount of taxes. Does anyone know if an IRA is garnishable or if my wife could take my IRA in a divorce? If it matters, I currently live in one state and my wife lives in another.

I am not an attorney, and this is REALLY a legal question that should be posted in the LAW forum.

That said, I believe that traditional IRAs CANNOT be garnished. However, if the money is sitting in your regular bank account, it is fair game for garnishment. Thus, you should roll this money into a rollover IRA ASAP!

Now, as for the divorce, the 401K or IRA are fair game as marital assets in divorce proceedings, and there is NO legal way to hide or protect IRA assets.

Yes, the IRA will protect you from the garnishment, Also you may look at a purchase of a annuity from an insurance company, you pay in a lump sum and they pay you an amount every month either for life or for a set number of years. I sell many of those to seniors in this area.

But most of these monies will be as mentioned "fair game" for divorce.