No one plans on getting divorced and it’s easy to be complacent about protecting your assets before marriage. Unfortunately, divorce is a sad reality of modern life, and you need to be proactive about making sure you get to keep what’s rightfully yours after divorce. There are many complexities involved with how assets are divided up in a divorce, which is why you should seek the advice of an estate planning attorney such as Beasley & Ferber. In the meantime, here are some strategies to know about that can help protect your inheritance from divorce.
Avoid Commingling Inheritance
Many couples consider it a sign of trust to have joint accounts and to have the attitude of, “what’s mine is yours.” In general, that’s an admirable and generous way of looking at things. However, when it comes to inherited assets, the smart thing to do is to avoid commingling. Commingling is when you mix up assets in joint accounts, pay a credit card bill from a mix of a marital asset account and an inherited asset account, deposit a marital asset check into an inherited asset account, or vice versa, and more. There are many “accidental” ways to commingle marital assets with inherited assets. The best way to avoid doing it is to consult with an attorney who specializes in these matters.
Have the Prenup Drawn Up This Way
When you meet with your estate planning attorney, have a prenup drawn up. Ask that the prenup specifically exclude your inherited assets against any possible future divorce. You may be able to have language in the prenup that specifies existing or future inheritance. This might be helpful in the event that you anticipate receiving an inheritance anytime after your wedding date.
Save All Documentation
Make sure that you save all documentation relating to your inheritance. This includes things like wills, trust paperwork, buys and sells, investment statements, bank statements, etc. When relevant and possible, keep the originals instead of converting them into digital files. In the event that your inherited assets are disputed during a divorce, the originals will bear more weight.
Establish a Special Trust
To protect and preserve your inheritance, create a trust. Because they are a great tool to protect assets, trusts are often utilized in estate planning. You may be confident that your inheritance will stay separate from your marital assets by putting it into a special trust. You and your estate planning attorney should set up the trust so it names yourself or your children as the beneficiary, rather than your spouse.
Whether this is your first marriage, second, or even third, it pays to give extra attention to protecting your inherited assets from a divorcing spouse. Remember, if you choose to do so, you can always concede assets as part of your divorce decree. However, using these strategies makes the decision yours and not the right of an estranged spouse. For assistance protecting your inheritance from divorce, contact Beasley & Ferber, expert estate planning attorneys in Massachusetts and New Hampshire.