No one gets married planning on getting divorced. Nonetheless, by some estimates, nearly 40% of marriages end in divorce. For this reason, many people create prenuptial agreements to safeguard their assets, while others create postnuptial agreements, which are the same, except they are created after the wedding. But the majority of married couples don't take this precaution, and when their marriages are shaky, they begin to wonder how to protect the assets they brought into the marriage.

Pennsylvania is not a community property state like California, where all marital assets are divided 50/50. PA is an equitable division state, which means a court will divide the property as seems fitting. This sometimes goes badly for one of the spouses. To avoid this, take action now to secure some of your premarital assets from division in divorce.

What property can be protected

For the most part, any assets that have been collected or earned during the marriage and that are not clearly separated from the family finances are considered marital assets and will be divided. This includes:

  • Salary from employment while working during the marriage
  • The family home and other assets used collectively by spouses and/or children
  • Benefits from retirement accounts, pensions, insurance plans
  • Gifts from one spouse to another

Property that is generally considered non-marital include:

  • Assets acquired before marriage, or the original value at the time of marriage
  • Inheritances that have not been used in any part to benefit the family
  • Gifts received from someone other than the spouse
  • Assets that have a written agreement specifically stating the property is non-marital
  • Certain trusts set up specifically to separate the value from marital assets

How to protect premarital or non-marital assets

The most important step you should take right now is to gather detailed documentation of the value of your assets prior to marriage and assets that have never been mingled with family finances or used by the family.

If you purchased your family home before you were married and it has increased in value, with proper documentation you may be able to retain the premarital value of the house and only split the increase. For instance, if at the time of the marriage your house was worth $200,000 and you can document this, and it is now worth $300,000, you may only have to divide $100,000 of the value of the home.

This holds true also for retirement accounts that have appreciated in value since you got married. However, if you started a job after getting married that provided you with a retirement account or pension, the entire value would be considered a marital asset. If you both have retirement accounts of similar value, though, it is likely you will just each keep the value of your own accounts.

If your uncle left you a boat and you have never taken your kids out on it nor fished for food for the family on it, you could argue this is non-marital property.

If you receive an inheritance, do not deposit it into a joint account, and do not use it for family needs. Keep your premarital savings or checking accounts separate, and don't use any of the money for the family's needs.

Protecting a business that you started before marriage but that supported the family will be more challenging, but it can be done. One important step may be to create a trust, which is managed by a trustee for the benefit of others. Another step is to eliminate your spouse's involvement in your business. If your spouse is helping significantly, the court may decide he or she has a significant stake in the company and could give a large control of the business over to your ex.

Final thought

Clear documentation of assets when they were brought into the marriage and what they are worth now will help determine how much of your non-marital assets you'll be able to retain. As experienced divorce attorneys, we know what to look for and the right questions to ask in order to help you define your personal assets and retain as much as possible in your divorce. Call us today in our Southampton, PA office at (215) 364-4900 to see how we can help you receive the best and fairest division of assets in your divorce.