According to Florida law, retirement accounts can be treated as both an asset AND a source of income for alimony purposes. So, in the context of seeking alimony modification due to retirement, courts are correct to look at retirement accounts now in pay (distribution) status as sources of income for the alimony payor, even though the other spouse received half of the account previously in the divorce. The result is a possibility that the spouse will at the end of the day receive more than half of the retirement account, despite the general rule that each party is entitled to only half of the assets. So, if the wife has imprudently cashed in her half of the retirement account before it went into pay status, she may not be penalized for that when the husband seeks to reduce his alimony payment due to his retirement. In fact, she may be essentially rewarded.
It may make sense for the payor to also cash in his retirement, taking the tax/penalty hit, and not have that money available to him when he retires, so that he can reduce his ability to pay alimony when retirement comes. However, he would then lose out on the potential interest and the tax benefits of a 401(k).
Until the law changes to prevent this type of double-dipping on retirement accounts, the payor of alimony is getting the short end of the stick.