Protecting Your Assets Without a Prenup: Here is What You Should Know
When a married couple decides to part ways, more than just their relationship is often divided. From joint bank accounts and loans, to shared property and assets, many couples may find themselves struggling to effectively divide their assets in the midst of a divorce, especially if it is not an amicable one. That is why some couples sign a prenuptial agreement before entering a marriage in order to supplant marital agreements such as shared accounts and property—essentially, prenuptial agreements enable each party to maintain control over their legal rights and division of property when entering a marriage.
If you are getting married and do not have a prenuptial agreement, or “prenup”, you run the risk of fighting for your assets in court in the event that you divorce. Here, the qualified Maryland divorce attorneys at Rodier Family Law discuss how you can protect your assets without a prenup if you do not currently have one.
Consider Keeping Pre and Post-Marital Finances Separate
Before entering into marriage, there are many serious yet necessary conversations that couples should have, one of which includes the financial relationship they wish to engage in.
In an era in which millennials owe an average of $33,000 on their student loans alone, many members that fall into this generational bracket may hold off on marriage as they prioritize debt repayment over other major milestones. While your partner may have some physical or digital assets, it is vital to understand their debts as well. In the unfortunate event that your significant other enters into bankruptcy, you run the risk of their creditors coming after your assets if you have joint finances. Additionally, consider opening joint accounts in addition to your separate accounts after marriage. By doing this, you will still be able to contribute to a joint fund for you and your significant other, but still keep your personal funds earned before marriage separate. While it is never pleasant to think about the possibility of divorce at the inception of your marriage, crafting a plan for your finances early on can provide a sense of security and peace of mind in the event that divorce were to occur.
Protect Your Individual Real Estate Purchases
Paramount, yet often overlooked, assets that should be protected are any real estate purchases or investments. In the event that you and your spouse divorce, commingling real estate can lead to severe financial consequences. While married, it is likely that you would want your spouse to inherit your home in the event that you pass, however, putting their name on the deed can be extremely dangerous. If the non-owning spouse’s name is on the deed, regardless of if it is removed later, you run the risk of the court presuming that, at one point in time, you have given that home to your spouse as a gift. In turn, your ex-spouse may be awarded a portion of the value of the home. In addition, consider using non-marital funds for separated property. For example, if you are supplying the funds for renovations or additions to a home that is in your name but is non-marital property and those funds come from a joint account, this will likely increase the value of your home and make it more difficult for the court to determine whether property it is considered marital or non-marital property.
Seek Valuation of All Business, Retirement and Bank Accounts
Finally, when aiming to protect your assets without a prenup, the most effective decision that you can make is to document everything. In the age of convenient and innovative technology, it is much easier to create a comprehensive and organized system for detailing any important records. This should begin at the time of your marriage. If you have records of retirement or bank accounts at the time of marriage and how they have changed, this makes it easier for the court to determine how much money is considered marital property and, as a result, how much should be divided between you and your ex-spouse.
Additionally, if you are a business owner, it is vital that you get the valuation of your business around the time of marriage. If this business becomes commingled, having documentation of the business value before appreciation can help protect you from your ex-spouse from requesting a portion of the current value in the event of a dissolution of marriage.
Discuss Your Financial Options With Harford County Divorce Attorneys at Rodier Family Law
While the most predominant way to prevent you and your spouse from disagreeing over assets in the event of a divorce is to obtain a prenup, this is not always feasible for everyone. If you are entering into marriage or are currently married without a prenup, it is important that you have the knowledge and resources to prevent sacrificing your assets in the event of a divorce. At Rodier Family Law, our qualified divorce attorneys have extensive experience navigating the legal complexities of the divorce process, and will fight to ensure that you are properly protected and compensated for your earnings prior to and during marriage. If you have questions, contact our Bel Air office today for assistance.