Marriage is both an emotional and legal partnership, and one aspect of this involves the division of assets and property. Should your relationship end or one partner passes on unexpectedly, knowing what happens to any joint property can have devastating ramifications if divorce or death occurs. Here we discuss what married property is, its division process, as well as some key considerations when thinking about getting married in this piece.
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Defining Marital Property
Marital property refers to assets and debts acquired during a marriage. This may include real estate, personal belongings, investments, or financial accounts obtained by either spouse during their time together. Marital property laws may differ depending on where one life, as some jurisdictions follow community property rules while others adhere to equitable distribution principles.
Classification Of Marital Property
Community Property: At divorce, the property should be divided equitably under community property laws. Such states include Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. Most assets acquired during a marriage are considered community property with certain exceptions, such as inheritance or gifts to either spouse.
Equitable Distribution: The majority of states follow the principle of equitable distribution. Under this system, marital property is not necessarily divided equally but rather in a manner deemed fair and just by the court. When dividing assets, factors such as the length of the marriage, each spouse’s financial contributions, and the parties’ individual requirements are considered.
Factors Influencing Marital Property Division
When determining the division of marital property, courts consider various factors to ensure a fair and equitable distribution. These factors typically include:
Financial Contributions: Each spouse contributes financially during a marriage, from income earned and investments made to other resources available to them.
Non-Financial Contributions: Non-financial contributions such as child rearing or homemaking are valued and considered when dividing marital property.
Future Financial Needs: Each spouse’s future financial needs are carefully evaluated. This involves factors like their ability to earn money, age, health, and any potential for hard times financially.
Fault-Based Considerations: Fault may come into play. For instance, if either spouse’s actions, such as adultery or mismanagement, had an enormously detrimental effect on the marriage, the resultant division of property may change accordingly.
Protecting Marital Property
To safeguard the assets in your marital estate, it is wise to take certain measures:
Prenuptial Agreements: Before getting married, couples may decide to enter into a prenuptial agreement in order to provide clarity and protect both parties’ interests. This agreement can serve as a roadmap toward an easy marriage.
Postnuptial Agreements: Similar to prenuptial agreements, postnuptial agreements are made after marriage for the purpose of defining how property will be divided. They can also come in handy should circumstances alter during the course of the relationship.
Separate Property Designation: Deliberately distinguishing between marital and separate property is of vital importance for successful marriages. Separate assets usually consist of those acquired before or during a marriage, inheritances received by one spouse, and gifts given directly by them – it is, therefore, crucial that records and separate accounts for these assets be kept to properly establish their separation from marital assets.
