This is a collaborative post
A divorce is not only an emotional trauma but also a period of great fiscal adjustment. Mostly, the division of matrimonial alliances comes coupled with a division of assets that were built up together over the years, likely to upset your financial equilibrium in the longer term. How to Protect Your Assets During a Divorce
Definitely, saving your own assets is important to ensure that you keep what really belongs to you and can assure yourself that you can still afford the lifestyle you were leading before your marriage fell through. To better protect your asset, let us see how it’s classified, how we can follow good rules, and when professional help may be appropriate.
Separate vs. Marital Property
Marital property consists of everything acquired during the marriage, regardless of whose name is on the title. The definition of separate property is everything owned before the marriage and anything received by inheritance or gift, specifically to only one spouse or the other. It is important to be able to determine which is which because only marital property can be divided in a divorce. Listing the assets that make up the best part of them gives you a better chance to prepare for the negotiation or litigation process.
Accurately Document Your Assets
Another critical step in the protection of your assets during the process of divorce is accurately documenting your assets. The procedure involves gathering your financial statements, property deeds, tax returns, and any other relevant document as far as the proper disclosure of your financial reality is concerned. Detailed records will prevent disputes concerning the ownership and value of assets, thereby making it easier to divide them equitably. Properly documented assets are also not likely to be casually overlooked or undervalued during divorce proceedings. Not sure how to properly document your assets? A consultation with a divorce lawyer will make sure you have everything covered.
Thinking About a Prenuptial or Postnuptial Agreement
If you are not yet married or are in the early stages of your marriage, consider the benefits of a prenuptial or postnuptial agreement. These agreements spell out exactly how assets would be divided if either party were to file for divorce and actually serve as protection for both parties involved. A prenuptial agreement is executed prior to marriage, while a postnuptial agreement is entered into after the onset of the marriage. Both are invaluable in asset protection, especially, if you have a lot at stake – own a business – or even have children from a prior marriage. These agreements can save time and legal fees by setting out expectations from the beginning.
When a Business Is Part of the Equation
Any entrepreneur wants to protect a business founded through hard sweat and tears that occurred before your happy nuptials. One is through the drafting of a prenuptial or postnuptial agreement that particularly states division arrangements with respect to business assets. In addition, business finances must be kept out of personal finances, since commingling funds will further complicate issues when it comes to division. When your spouse has been involved in the business, clearly defining roles and responsibilities in writing will also help in protecting interests. Working with a business and family law specialist shall guide the separation terms one can adapt in a divorce.
Awareness of Joint Accounts and Debts
Joint accounts and debts may be complicated during the divorce. The moment the divorce is filed, closing joint accounts, or converting them to individual accounts, early in the piece will prevent debt accumulation and reduction of assets. Remember also, that even after a divorce is final, joint debts such as credit cards or loans hold both of you accountable for payment; a creditor is not held to your divorce decree. Positive action on these matters, worked out amicably if possible, taken right away can lessen damages in a financial sense and can further help you protect your credit. Divorce can be difficult to manage without professional advice, and obviously this warning does not require elaboration on what to do. Joint accounts and debts from a divorce are especially critical to manage properly now, so make sure you are seeking proper advice from a financial advisor.
Professional Help
Almost every divorce process requires professional guidance in order to be successful. Building a relationship with a family law attorney will serve to protect your assets and your rights. This type of attorney offers customized advice on property division, prenuptial agreement, and other legal matters related to divorce. Not only will you get legal aid, but the collaboration with a financial advisor may also be useful in looking over the long-term effects of the division of assets and planning your financial future accordingly. With this team of professionals at your side, you will be positioned better to tackle your divorce head-on and protect your assets adequately.
This is a very vital stage since it will help you protect your money for the future. Knowledge of marital property laws, documentation of your assets, prenuptial agreements, protection of business interests, management of joint accounts, and professional help may provide you with some confident ways to deal with the complex issues of divorce. After all, while divorce cannot ever be easy, proactive steps towards safeguarding your assets will definitely help you emerge with financial stability and a peace of mind from the court of law.
Disclosure: This is a collaborative post