Divorce is a difficult and emotional process that can have a significant impact on one’s finances. One of the biggest concerns for individuals going through a divorce is how to protect their assets.
In this article, we will discuss 6 legal tips on how to protect assets from divorce. These tips are not only for those who are already married but also for those who are planning to get married in the future.
Prenuptial Agreement
One of the most common strategies on how to protect assets from divorce is to get a prenuptial agreement or prenup. This is a legal document that explains how your assets will be divided if you get divorced or if one person dies.
This legal protection lets couples choose how to share their assets instead of letting a court decide. Prenups are especially useful for people with a lot of assets, business owners, and those who have kids from previous marriages.
Postnuptial Agreement
Similar to a prenup, a postnuptial agreement is a legal document that outlines the division of assets in case of divorce. The difference is that it is signed after marriage instead of before.
A postnuptial agreement can be used to protect assets that were acquired during the marriage, as well as those brought into the marriage. It can also outline spousal support and other financial arrangements.
Keep Inherited Assets Separate
Inherited assets, such as property or money, are typically considered separate property in a divorce. This means that they are not subject to asset division during the divorce proceedings.
To ensure that your inherited assets remain protected, it is important to keep them separate from marital assets. This can include keeping inheritance in a separate account and not using it for joint expenses.
Establish a Trust
A trust can help protect assets by placing them under the control of a trustee for the benefit of beneficiaries. Certain trusts, such as irrevocable trusts, may shield assets from being considered part of the marital estate.
This can provide added protection in case of divorce. It is important to note that establishing a trust should be done before marriage, as any assets acquired after marriage may be subject to division during a divorce.
Avoid Commingling Assets
Commingling assets is when marital and separate assets are mixed, making it difficult to determine which spouse owns what. This can happen if separate funds are used for joint expenses or if property owned before marriage is put in both spouses’ names. To protect your assets from divorce, it is important to keep them separate and avoid commingling them with marital assets.
Hire a Divorce Lawyer
One of the best ways to protect your assets during a divorce is by hiring an experienced divorce lawyer. They can provide legal advice tailored to your specific situation and help you navigate the complexities of asset protection laws.
A lawyer can also help negotiate a fair settlement that ensures your assets are protected. Without proper legal representation, you could end up losing a significant portion of your assets in a divorce.
How to Protect Assets From Divorce? Start Planning Early
Divorce can greatly affect your finances. To help protect your assets and ensure a fair division of property, follow these 6 legal tips. Being prepared is key to avoiding financial losses during a tough time like divorce. Keep these tips on how to protect assets from divorce in mind before getting married or while going through a divorce.