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How to protect separate assets in the event of divorce

by | Jan 4, 2021 | Asset Division, Divorce

In a North Carolina divorce, most assets acquired during the marriage will be divided in an equitable fashion. Generally speaking, you are also entitled to keep any items that you owned prior to getting married. However, there is a chance that a home, car, or bank account could be commingled after the wedding takes place. Let’s look at some steps that you can take to prevent that from happening.

Create a prenuptial agreement

A prenuptial agreement can stipulate that certain assets are to retain their separate statuses in the event of a divorce. For instance, you may use such an agreement to keep complete control over your business or to retain ownership of family heirlooms. If you aren’t able to execute the agreement prior to your wedding day, it may be worth looking into creating a postnuptial agreement.

Put assets in a trust

Typically, assets that are placed in a trust are considered to be held outside of the marital estate. Therefore, they generally cannot be taken from you in a divorce. However, it may be necessary to create the trust months or years prior to the end of your marriage.

Find out what your spouse wants or needs

Failing to create a prenuptial agreement or trust might leave you vulnerable to losing valuable assets. Of course, your former spouse might not really want an ownership stake in your business or to take any assets that were commingled during the relationship. Instead, he or she may want to keep the family home or to take ownership of your vehicle. In such a scenario, it may be possible to keep assets that are most important to you in exchange for assets that are most important to your spouse.

An attorney may be able to review a prenuptial agreement, a trust, or another document that you have prepared to protect separate property. Assuming that these documents are valid, they may be used to end the divorce process in a timely and favorable manner. It is important that you speak up and let your wishes and your available documents be known to your attorney and your former spouse.