Dividing Assets in Divorce
In this world, nothing is certain, except death and taxes. Benjamin Franklin’s famous yet fatalistic quote also applies to the splitting of assets during a divorce. If you’re searching the Internet for a quick and easy formula to tell you what you’ll get in a divorce, stop. It doesn’t exist.
The divorce laws in every state in the United States are different, and so are the circumstances surrounding every couple’s divorce. The following are factors that can influence the outcome of how assets are divided during a divorce:
- How long you have been married.
- Reasons surrounding why the marriage is dissolving.
- Whether or not one of you is in the military.
- Whether or not one of you is disabled.
- How old you are.
- Whether or not you have children.
There are no hard and fast rules. The only guideline is that both assets and debts should be divided equitably, or fairly. Fair does not necessarily mean equal, and your perception of what is fair may be vastly different from your ex’s.
Equitable Division of Property
Marital assets are generally everything that you and your spouse acquire together during your marriage regardless of how it is titled. For example, the deed to the house may be in your spouse’s name, but you purchased it during the time you were married. It is marital property. On the flip side, even though the mortgage to the house is only in your spouse’s name, it’s your debt too.
Common Marital Assets and Liabilities
- Your primary home
- Vacation residences or rentals
- Vacation club or country club residences
- Business property
- Personal property such as home furnishings, jewelry, artwork, antiques, boats, motorcycles, etc.
- Bank accounts
- Retirement accounts
- 401(k) plans
- Stocks and bonds
- Stock options
- College savings accounts
- Mutual funds
- Life insurance
Alimony or spousal support isn’t an automatic part of a divorce settlement. Alimony payments are negotiated between divorcing partners as part of their divorce settlement or ordered by the court if the couple can’t agree. When the courts get involved, alimony is usually not granted for couples who have only been married a short time.
Alimony is intended to allow both spouses to continue a similar standard of living. In many cases, one spouse may have chosen to forego a career or only work part-time to help care for the family.
But even if you are not currently working or are only working part-time, that does not necessarily mean you will get alimony. Some of the factors the court will consider in cases involving alimony are:
- What are you capable of earning if you go back into the workforce and obtain a full-time job?
- How long will it take your job prospects to improve if you’ve been out of the workforce a while?
Child support also isn’t an automatic part of a divorce settlement, even if you have children. If you and your former spouse earn approximately the same amount of income and are sharing custody of your children, child support payments may not be necessary.
Child support payments are used to pay for expenses specifically related to the care and well-being of the children, including housing, food, clothing, schooling, daycare, healthcare, and extracurricular activity expenses. Child support payments ordered by the court don’t always include things like college, orthodontics care, car insurance, or cell phone plans. These are items you and your spouse may need to negotiate separately as part of your parenting plan.
Most often, child support payments occur when one parent does not have physical custody of the child. It is also commonly seen when joint physical custody is not shared between the parents. However, child support payments can be required in a 50/50 physical custody split because one parent earns substantially more than the other. The courts generally want to make sure a child benefits from the same standard of living he or she would have enjoyed if the marriage had not dissolved.
Who Gets What in Divorce?
Ultimately, what you are entitled to in the divorce is going to come down to a couple of things:
- What you can negotiate with your former spouse.
- The competency of your lawyer while representing your interests to the judge.
For most couples, negotiating an agreement outside of the court, through mediation or arbitration
if necessary, is a preferable option to having a judge make the final determination on splitting assets. Consult with an experienced family law attorney in your area to learn more about your options.