If you either have already inherited, or expect to inherit, any significant assets, it’s important to consider how marriage — and divorce — could affect those assets. You risk losing them in divorce if you don’t take steps now to protect them.
Here are some of the things you should know about inheritances:
1. Ask for a prenuptial agreement that keeps your inherited property and assets out of any divorce. If you approach the issue fairly — and openly acknowledge your fears — you may find your prospective spouse equally hoping to protect his or her assets as well.
This is particularly important in second marriages when there are children (adult or otherwise) involved. If you desire to see important family heirlooms, for example, passed to your biological children — not your spouse’s biological children — this is a must.
2. Keep your personal property out of the marital pool. If you inherit a significant sum, don’t put it in a bank account with your spouse’s name on it. Even if you only intend the name to be there “for emergencies,” adding your spouse’s name to the account confers ownership interest to your spouse. If you simply want to make sure your spouse can access the money if you die, the account can be set up so that ownership transfers on your death.
Similarly, don’t mingle marital money in with non-marital money. For example, you could destroy the “non-marital” status of a bank account full of inherited money if you start depositing your paychecks — which are earned during your marriage and thus part of the marital assets — into the same account.
3. If you inherit real property, like a house, you need to be careful about any updates you make to the property. If you use marital funds to make those updates, your spouse gains some interest in the property. If that’s the only way possible to do the updates, you will need to recognize your spouse’s interests if you have to divide the property later due to divorce.
Source: FindLaw, “Managing Marital Property: Do’s and Don’ts,” accessed Feb. 09, 2018