5 Ways to Make Sure You Don’t Lose Your Shirt When Splitting Marital Assets

With any looming separation or divorce, you are wise to be worried about the income and assets and how your financial well-being may be impacted.  This article will give you some essential background information and five ways to make sure you protect your assets in a divorce.

Background.  In California, community property includes all the assets and income acquired during the marriage, and the law requires that the community property will be divided equally, unless there is a written agreement requiring something different.  

1. Identify the Extent and Value of Your Marital Assets.  This step is vital to protecting your financial future.  Discover and document everything you can about the state of your marital financial affairs.  In many instances, taking screen shots of information that shows both the information and the date can be very useful down the road.

 

  • What bank accounts do you have and how much money is in them?
  • What investment accounts do you have and what are those values?
  • Are there employment benefits involved, such as HSA accounts?
  • What health insurance do you currently have?
  • What real estate holdings are involved?
  • What other benefits might be applicable, such as military benefits?

 

2. Get Your Ducks in a Row About Your Separate Property.  In general, separate property is anything acquired before the marriage, by gift or inheritance during marriage, or property obtained during the marriage that can be traced to a pre-marriage acquisition.  What does this mean for you?  The court is going to presume that any property acquired during the marriage, except by gift or inheritance, is community property.  That means that you need to gather the proof to show that what is yours is yours.  Look at all sources of documentation to prove your case. This is a list of where to start to look for that proof:

 

  • Check emails
  • Find texts
  • Ask the gift-giver for any documentation they might have of the gift.
  • Look for documents or receipts
  • Check account histories

3. Don’t Sweat the Small Stuff. Most people in a divorce are angry, disappointed and hurt.  There is a temptation to be stubborn and to focus on a few key emotional items.  If you want to be financially successful in your divorce, you will likely be best served by letting go of the negative emotions and thinking about your marriage as a business that is winding down.  Don’t get caught up with issues or assets that don’t have a great value.  Time is money, and you will not get the satisfaction that you are seeking out of a “So there!” moment from operating out of revenge or vindictiveness.  As much as you can, look at your assets impartially, and seek to make moves that will benefit you the most long-term.

4. Don’t Lie, Cheat or Hide.  For many, it is ever so tempting to hide an account here or lie about an asset there.  This is typically a very poor long-term strategy for protecting your money.  A court can order you to pay the legal expenses of the other side for the search of hidden assets.  Those legal fees can add up.  Furthermore, a judge can sanction you for lying to the court.  Think long-term not short-term, and be forthcoming in your disclosures, not just because it’s your duty, but also because it really is almost always in your best interest financially as well.

 

5. Hire Competent Help.  The legal fees for an attorney can seem daunting, but having an experienced guide help you through the maze of dividing assets will often save you money.  Find an attorney who is experienced in divorce and who is committed to helping you reach your goals for dividing your assets.