Besides the loss of a loved one, divorce is one of the most difficult and stressful times that anyone can go through. Not only does it disrupt the lives of both spouses, it can tear at the heart of the children too.
And of course there’s the financial costs; attorney fees, ongoing maintenance fees, etc.
Needless to say, divorce is a very serious matter.
This is why it’s so important you do everything within your power to avoid it.
Of course, if there’s anything you’ve learned as an adult, it’s best to hope for the best, but prepare for the worst!
Following are some protections you can put in place to minimise the loss of assets you bring into or that are accumulated during the marriage:
Sign a Prenup
Think of it like insurance for your marriage. It should protect each of you without harming the other.
Contrary to what you might imagine, you can create such a document even if you’re already married. Simply come to some kind of agreement between yourselves about how assets would be split up (both existing and potential assets) and hire a solicitor who specialises in such things to draw up the paperwork.
Instances where such an agreement is crucial:
• If one of you brings substantially more assets to the relationship than the other.
• If either of you have adult children from previous relationships.
• If either of you are expecting a sizable inheritance.
The document must not have been signed under duress or deception. If it can be proven that it was, then the courts will consider it null and void.
Honesty is ALWAYS the best policy
Don’t try to hide anything from the court.
Selling all of your earthly possessions to your best friend for a $1, creating complex company structures, trust funds and super accounts are not smart moves to make and will win you the ire of the court.
Trust funds can certainly be used, however experts warn than Family Law Court can see through complex structures to see who truly maintains control of the funds.
The best way to protect your child’s inheritance is to protect it from your child’s divorce by setting up a trust fund that can only be accessed by your child and which is disbursed over years rather than in a single payout.
Of course this is not foolproof as the income from the trust fund can play in the settlement, however it’s better than the entire lot being split up should your child(ren) divorce.
Keep your Will up to date
Imagine your grieving wife, stunned at your demise, collapsing from the shocking news from your attorney that your “ex-wife” gets everything.
Simply because you were too busy to update your will.
This is just one reason why it’s so important to keep your will up to date.
Obviously you’ll need to consult with an experienced professional to put the right protections into place, as this information is only general in nature.