Divorce can be a messy ordeal. When two people build a life together, personal assets sometimes wind up becoming community property. While prenuptial agreements are a great start, they’re not bulletproof. Here are some tips to help you protect your assets during a divorce.
Consult with an Attorney
One of the first steps you should take is to consult with a competent attorney who specializes in divorce and family law. A lawyer can help you protect your assets and advocate on your behalf for your rights.
Consider a Pre- or Post-Nuptial Agreement
While they aren’t bulletproof, a pre- or even a post-nuptial agreement may help you protect some of your assets in case of divorce. Keep in mind that not all states recognize these agreements, and even in states that do, they are often contested.
Open Accounts and Credit Cards in Your Name
If you and your spouse share a savings or checking account, you may consider opening a personal account in your name. You may also withdraw some of the money from your shared account, and deposit it into your personal account. You must inform your spouse of this and be transparent about the amount of money you are transferring to your account.
Opening a credit card in your own name is also something to consider.
Keep Gifts and Inheritance Separate
Avoid comingling any inheritance or gifts you receive with your marital funds or placing either in a joint account. Keep these separate, and in accounts that are in your name.
Take Inventory of Debts and Assets
With the help of your attorney, take a complete inventory of all your debts and assets. Create copies of credit card and loan accounts as well as home equity lines and business debts (if applicable) for safekeeping.
Also, be sure to take an inventory of all non-marital property, or items that belong to only you or your spouse. These may be property that was brought into the marriage, gifts or inheritances.
Update Your Will
While you’re preparing for your divorce or shortly after it’s settled, revisit your will and update it accordingly. Most states exclude former spouses from receiving under a will, or serving as an estate administrator or trustee. However, it’s still good practice to update your will to ensure that your last wishes are in line with your current life situation.
Don’t Hide Any Assets
It may be tempting to hide assets from your soon-to-be ex, but doing so will only lead to trouble. Keep in mind that during a contested divorce, discovery is performed – which includes the sharing of information (under oath) regarding debts, assets and income. You may also be required to provide documents, testify in a deposition or answer written questions. If you lie or try to hide any assets, the act would be considered perjury – which is a criminal offense.
In the very least, the judge may decide to give your spouse a disproportionate share of the asset (more than 50%) or fine you for your behavior. Hiding assets is never a good idea.
Protecting your assets during a divorce is not always an easy task, but it can be accomplished with the right amount of planning and help from an experienced divorce lawyer.
The Micklin Law Group, LLC is a New Jersey law firm specializing in family law and estates. Attorney Brad Micklin was recently named to The National Advocates list of Top 100 attorneys from each state. To set up a consultation, call 973-562-0100.