Divorce FAQ's
1. I am getting married next month. I don’t want to get a prenup, but I don’t want to lose my life savings either if my marriage turns into a disaster. What can I do to protect my premarital assets?
In a perfect world, you should contact an experienced matrimonial lawyer and have a prenuptial agreement drafted. In the vast majority of the cases prenuptial agreements are uniformly upheld by the family courts. However, let’s get real, a prenuptial agreement takes out the romance and excitement of getting married. Therefore, the next best thing instead of having a prenup is to keep your premarital assets separate from your future spouse. After you get married, then all of you premarital assets are exempt from equitable distribution. However, the family court judge can still order you to spend down your premarital assets to pay for support obligations in the event of a divorce.
Nonetheless, if you are getting married and if you don’t have a prenup drafted, then you should try your best to keep as much of your premarital property separate from your future spouse. The property owned by married people is generally classified as separate property or marital property. Usually, your separate property is the property you owned before you married. If you have a mutual fund, then don’t place your spouse’s name on the account. If you have a large savings account, then you should also not put your spouse’s name on this account as well. If you have a vacation home, then don’t place your spouse’s name on the title. Get the message, try as best you can to keep your property separate. You can advise your spouse that “My money is your money.” These comments can be used to create a harmonious marriage. However, these comments can’t be used to determine the equitable distribution of the parties’ assets.
2. I own a very profitable family contracting business. I am taking a big risk by getting married. What legal steps can I take to protect my business from my spouse if we should ever get divorced?
If you own part of an existing family business, then you and your family may want to keep control of the business among yourself, your parents and your siblings. Therefore, any shares which you own in a closely-held family business should remain in your name alone. If you work for the family business while you are married, then your spouse could acquire a marital interest in your share of the business. Even if you do not work for the family business, then your spouse can acquire a marital interest in the increase in value of your share of the business. You can limit your spouse’s claims against your family business if you have an air tight prenuptial agreement drafted. Nonetheless, if you are merely keeping your stock in your name is probably not enough to keep your interest in the business from becoming marital property.
3. I have received a large inheritance from my rich uncle. I am very apprehensive that my new wife will try to get her hands on my inheritance if we should ever get divorced. What can I do to protect my inheritance?
Generally, any property that is acquired by gift or inheritance after the marriage is considered to be separate property, and it is not subject to equitable distribution. If this property consists of a portion of real property such as a rental home or a vacation house, then you might want to keep this as separate property. Otherwise, the property might have to be divided or sold to compensate your spouse if you should ever get divorced. Additionally, you should be aware that any increase in value of the gift or inheritance may ultimately be considered marital property, and it may be subject to equitable distribution upon your divorce.
4. I am getting married next year. This will be my second marriage. I obtained a lucrative settlement during my first divorce case. How can I protect my assets that I obtained from my first divorce settlement?
You may need to keep property from a previous marriage as separate property in order to pass it onto your children from the previous marriage. For instance, if you own a house which you want one or more of your children to inherit when you die, you will need to keep that as separate property during your new marriage. This can be complicated because the house will become marital if you spend money, which you earn during your new marriage, on maintaining the house. The increase in the value of the house can also be marital property, or if you rent out the house, the income will be marital property.
5. Do you have any hot tips for me to protect my premarital assets if my upcoming marriage turns into a disaster?
You should be very aware that your separate property for marital purposes can be easily changed from separate to marital property. For instance, if you own a house before you are married and that house becomes your marital residence after you get married, then your house will probably be considered marital property. Moreover, if you sell your separate property and use the proceeds to buy something that supports the marriage, then the new property will also probably be considered marital property.