With more than half of marriages ending in divorce, it’s important to take steps to protect what’s yours from the perils of divorce. There are several ways to do this, and your divorce attorney can guide you along the way. Some of the most effective ways to protect your personal assets are as follows:
If you’ve yet to walk down the aisle and are preparing for the worst, a prenuptial agreement is a smart choice. A prenup will list all of the property that both you and your partner own, including debts, and will specify each person’s property rights after the marriage.
Although not ironclad, a solid prenuptial agreement can protect your property in case of divorce.
If you’re already married and headed for divorce, a prenuptial agreement will not be an option. However, there are still ways you can protect your property.
Gather and Protect Financial Records
Be sure to obtain copies of your important financial records from the last 3 to 5 years. Once you have these documents in hand, make sure that you store them in a private place that your spouse will not be able to access.
As part of the divorce process, you and your spouse will be required to disclose the extent of liabilities and assets. For this reason, it’s crucial to have financial records, such as credit card statements, bank accounts, retirement accounts, investment portfolios, mortgage payments and income tax returns.
Keep Personal Property Separate
Whatever property was yours before the marriage will be yours after the marriage. But in order for the courts to consider it personal property, you must keep it separate from your spouse.
Let’s say you inherited money from a deceased spouse. If that money was placed in a joint bank account, then the court would argue that it was marital property. But if that money is kept in a separate account, it would be considered personal property in most cases. If you owned a home before the marriage, you will be able to keep the home provided you never add your spouse’s name to the deed.
The bottom line: keep personal property separate if you want to keep it after the marriage. If you’re unsure of what qualifies as personal property, consult with your attorney.
Take Control of Spending
If you have a substantial amount of assets, personal expenses will be quantified. Family expenses, like school tuition, nanny costs and the mortgage on the vacation home, will be considered by the court when determining your family’s lifestyle.
If you’re incurring extraordinary expenses at the time of the divorce, the amount of child support and a division of the property may be increased to take these into consideration. If you own a business or have complex investments, it becomes even more critical to be mindful of your spending, and to take control of the family’s spending habits ahead of the divorce.
The Micklin Law Group, LLC is a New Jersey law firm focusing on family law. 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.