When facing a divorce, your mind will likely be racing as you think about
everything you want to protect, from your finances and property to your
relationship with your children. In this post, we are focusing on the
assets that are typically the most important to protect for your future
well being. Of course, you will decide which are most important to you;
this article is intended to provide some guidance on which assets are
usually most significant.
#1: Retirement Accounts
Among the most important assets to protect in a divorce are your retirement
accounts. When thinking about
dividing retirement accounts, you should consider the accounts in your name as well as the accounts
your spouse has contributed to during your marriage. The latter is particularly
important if you chose to contribute less to your individual retirement
because your spouse was contributing more to his or her retirement account.
These retirement accounts may have significant value that would require
substantial effort to rebuild, which is why they are considered one of
the most important assets to protect in a divorce.
When considering the retirement accounts, you should not forget about pension
plans, beneficiary designations, and survivor benefits. Even if you and
your spouse are not ready to retire at the time of your divorce, you may
have an interest in your spouse's future pension plan payments, which
you should protect in your divorce. You should also be sure to consider
whether you should be designated the beneficiary on your spouse's
retirement account or whether you have an interest in the survivor benefit
portion of your spouse's pension plan.
#2: Your Home
For many individuals going through a divorce, the family home is the largest
of their assets, and it may also have an emotional value to you. It can
be beneficial to protect your home in the divorce, particularly if you
have equity in the home or if it is currently undervalued. You may want
to consider whether it is more beneficial to you to list the home for
sale in order to get rid of high mortgage payments or to receive the equity
in the home.
(More considerations on how to divide the family home as an asset.)
If one person is awarded the home, you should keep in mind that many individuals
are not able to refinance their home after a divorce, so if the party
who is to pay the mortgage is unable to make those payments, it may affect
both parties' credit histories.
#3: Business Interests
You will need to be able to continue to provide for yourself after your
divorce and if you are a business owner, you would need to maintain your
business's finances and reputation. You might consider a protective
order for any business records provided as part of your divorce in order
to protect private business information. You might also consider requesting
a regular accounting for the business so that you are kept informed. You
should discuss how to best protect your business in a divorce with an
attorney who is knowledgeable about valuing and protecting business interests,
closely held businesses, and professional practices.
#4: Financial Accounts
As you transition from a single household to two households, it is important
to protect your financial accounts. This includes checking and savings
accounts, as well as other investment accounts. You and your spouse will
both likely need access to liquid funds when your divorce is finalized.
As financial accounts are often much more liquid than retirement accounts,
you should try to protect your financial accounts as you go through your
divorce so that the funds are not depleted while you wait to finalize
#5: Property With Special Meaning
When going through a divorce, you should consider the assets that have
an emotional value to you, like your family heirlooms, as well as the
assets that have a financial value. You should consider which property
items are most important to you so that you can ensure that those items
are protected throughout your dissolution. You can find out what options
are available to protect your property throughout your divorce by consulting
with a qualified divorce lawyer.
Consider the Long Term
Ultimately, you will decide which assets are most important to you (and
therefore most important to protect) as you go through your divorce. As
you make these decisions, consider which
types of assets will provide you the greatest benefit in the long term, whether that benefit
is financial or emotional. You should also consider which assets will
be most useful to allow you to establish yourself and provide for yourself
after your divorce is finalized.
In any situation with more than a few thousand dollars at risk, it is highly
recommended that you consult with a family law attorney to discuss how
to protect your assets during a divorce. Also, be aware that fighting
over every little thing in a divorce will tend to drive up your legal
costs — so make sure you choose your battles wisely (
not like these people).