The W came home today and told me to call her mom because she had questions regarding the bills (Like stated her mom was helping us get straight on our bills) So I called her, and things went from bill talk to talk of moving and separation. Apparently my W was talking to her about it and trying to set a financial plan to move for both of us. She's wanting us to liquidate our 401k plans to get enough money to pay everything off, wedding loan, other loans, etc and move our separate ways. I've already thought about a loan from my 401k to move, get a cheaper vehicle, etc if and when the time comes. But I will not liquidate my 401k. That is just plain stupid to take out $18K for my future.
It sounds like the two of you have an absolute mountain of debt and no capital or savings other than your 401K's. You mentioned asking your W for gas money last week, so I'm assuming things are very tight. Your debt is heavily enmeshed between the two of you and it sounds like your MIL is trying to figure out how to unwind that. The bottom line is joint loans in both of your names must be closed out in the D. You can take out another loan to pay off your half (assuming you can qualify for the loan) or you can cash in your 401k. She has the same choices for her half. If you don't want to cash in your 401K then that is your choice, but you've got to figure out how to come up with the money to pay off your half of the debt.
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The MIL is getting to be to controlling of the situation and I'm not really liking it.
It doesn't sound like it to me, it sounds like she is trying to help. I think she's probably right that the easiest way to walk away with a clean D is to cash out the 401k's and pay off all the debt. That may not be what you want to do, and of course that is up to you, but nevertheless her advice is sound.
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My question is how should I go about trying to get the MIL out of being so involved in our sitch?
I agree with R2C- hire a professional financial planner. If you can't afford one then just tell MIL you don't want to cash in your 401K and will look at other options. If she browbeats you about it then remind her this is a DIVORCE and by definition you and W are no longer a team, so W needs to figure out her side and you need to figure out yours. But don't just assume this will all work out on its own. You've got to figure out how to cover your half of the debt.
