You had a long and loving relationship with your Aunt Millie. The bad news is that she recently passed away. The good news is that she left you a lot of money in her will. Let’s look into the future for a moment. After a nasty divorce from your spouse, would you want your spouse to leave with any of that money? Of course not.
If you are not careful, your spouse could leave the marriage with half of that money. Your spouse could also leave with half of all of those assets that you worked hard to accumulate before you got married. What can you do to stop that?
In most states, the assets that you have on your wedding day are considered non-marital and do not get divided up when you get divorced. They stay with you. Also, any gift or inheritance to you from someone other than your spouse, even if during the marriage, is considered non-marital and stays with you as you leave the marriage in a divorce.
If you commingle your non-marital assets with your marital assets, they become marital. So how do you keep from doing that?
All of the assets that you had before the marriage and any gift or inheritance from someone other than your spouse should be kept in separate accounts that do not include your spouse’s name. The income that either of you earns during the marriage is considered marital property. It is just as if all of your paychecks and those of your spouse have both of your names on them. You need to make sure that none of that money gets placed in the same account that has your non-marital funds. You also need to make sure that none of your non-marital funds get into an account that already contains those marital funds.
If you have non-marital real estate or automobiles, you must never place your spouse’s name on the titles. This even means avoiding creating a joint title. Those assets must be titled strictly in your name alone or in the name of a trust for your benefit where your spouse is not the beneficiary or the trustee.
In some states, the judges have the discretion to order that you get some or all of your commingled, non-marital money back. Some states do not give that authority to the judges. Even if the judge has the discretion to give some back, there are many examples of cases where the judge only gives a portion of it back.
Bottom Line: If you don’t want to eventually give half of your non-marital assets to your spouse, keep the ownership of those assets strictly separate from your marital assets during the marriage.