No one gets married thinking that they would get separated, divorced, or annulled one day—but it’s something that every couple must prepare for, no matter how in love they are, especially when the marriage involves a substantial amount of different types of assets. If you’re married but didn’t sign a prenuptial agreement, here are some ways you can protect yourself and what you own.
Work through it with reliable professionals
Suppose you think your marriage is headed towards a separation, divorce, or annulment. In that case, the first thing you need to do to protect your assets, yourself, and your kids is to consult with reliable divorce attorneys. These lawyers will help you gain a keen understanding of the resources that are available to you. With that, you know how to prevent having to sacrifice your assets in case you find yourself going through an annulment or divorce.
Get a valuation of everything you own
The next thing lawyers can help you with is getting a full valuation of everything you own—from finances to businesses, investments, and other sources of wealth. There is no better time than now to come up with an organized and comprehensive system that can detail all your financial records. It should detail everything from the time your marriage began.
Come up with detailed records of how much you earned. This can make it easier for the court to identify the money and property considered yours and your spouse’s. They can also figure out which ones need to be divided equitably.
Open one joint account and everything else separate
If you and your spouse are still happily together, one of the biggest safeguards you can put in place is opening a joint account for what you want to save up together. Keep everything separate, especially those you started when you were single. The joint account is for finances and funds that you will use during your marriage and build your life together. Meanwhile, the separate accounts will help ensure that you don’t risk or jeopardize those you managed to save before the marriage.
Make sure, however, that you are both on the same page on this. The last thing you want is to hide a separate bank account from your spouse—that’s not fair to them. Explain that both of you need to have some form of fallback, especially since you didn’t sign a prenup.
Keep your taxes and property separate
Even if you live in the same home, it will be in both of your interests to make major payments that come from separate accounts. What you can do is ask your accountants to prepare everything separately. But have a “true-up” schedule that will pave the way for you and your spouse to still file your taxes together and reap the benefits.
Another thing to consider is making major improvements to the home. You can focus on what can increase the property’s value so that records will show that only one of you truly owns the property. Other basic maintenance fees can come from the joint account.
Explore revocable trusts
A revocable trust is a legal entity that can help provide another layer of protection for you and your spouse. It entails having a third party who can help you manage whatever funds you have.
When you have this third party, a trustee, handling your financial transactions when the wealth appreciates, it’s considered individual property as opposed to marital. This is because you are not the one responsible for causing the property to appreciate and grow. Another benefit to this strategy is that you will have an easier time keeping track of your funds and how it’s growing. That would help prevent you from commingling the funds.
Talking about finances, even with your spouse, can be uncomfortable. But these are necessary and practical discussions to be had if you want to protect your and your children’s financial future. Here are some points for navigating these discussions:
- Be kind and remind your spouse that having these difficult but necessary conversations is in everyone’s best interest.
- Make sure to consult with your lawyer before making big financial decisions, especially if you and your spouse have agreed to dissolve your marriage.
- Don’t be afraid to seek and understand all your financial options so that you can make informed choices.
Going through a divorce is hard, but you don’t have to go through it alone. Trust your community and your lawyers, and believe the best is yet to come.