After you tie the knot, you have every reason to believe that you and your spouse will remain married for the rest of your life. However, this doesn't mean you shouldn't protect yourself in the event of a divorce.
There is more to managing marital property than meets the eye, with these tips among the most important:
- Consider a prenuptial agreement: This is the best way to determine upfront what property is and is not subject to division in the event of divorce.
- Keep accurate records: If you need to establish that an asset is not marital property, you should keep records that prove this.
- Keep separate property separate: If you bring an asset into the marriage, keep it separate. If you don't, it may be considered marital property if you divorce.
- An increase in value can make things tricky: If nonmarital property increases in value during your marriage, both individuals may be entitled to part of the increased value.
- Use nonmarital assets to purchase other assets that you want to remain separate: If your spouse pays for part of the asset, he or she can stake claim to his or her share in a divorce.
It can be a challenge to manage marital property, because you don't want to do or say anything that could lead to an argument with your spouse.
With a prenuptial agreement, you can get all this out of the way before you marry so that you don't have to focus too much time on it in the future.
If you are involved in a high net worth divorce, make sure you use a property division checklist to clearly outline what's separate property and what both individuals own.