For many divorcing couples, the financial upheaval of a divorce can be a struggle. The division of assets can not only be upsetting but also a very real worry. Understandably, previously passed on inheritances, and those which have been outlined for the future, are often used as a financial safety net when a couple is separating. Therefore, it is completely understandable that many individuals are concerned as to what happens to these funds when assets are being divided. With many inheritances coming from loved ones, this adds a sentimental spin on the situation that can complicate matters further. So, what could happen to your inheritance when you divorce? And, how can you protect yourself?
Inheritance is not automatically considered an asset, or part of the joint matrimonial pot. However, sometimes the courts will decide, on a case by case scenario, that inheritance money should be divided too.
Inheritance from before marriage
If you went into a marriage with money that you acquired before you married your ex-spouse, make a claim on it. If they benefitted from the inheritance money you brought to the table throughout the marriage it could be argued that they have a shot at securing some of the remaining funds.
However, you may be able to protect your inheritance by creating an agreement with your spouse that is outlined in the divorce papers. By using the expertise of a solicitor, this would protect you and your money.
Money during the marriage
Any inheritance received during the course of a marriage is likely to be considered as an asset to split upon divorce. The courts often deem any money received during the marriage to be an asset to the family as opposed to you as an individual.
Inheritance after the marriage
Any money inherited after separation is unlikely to be considered in divorce proceedings. Future inheritance is only ever considered if it is a substantial sum that could affect the financial settlement being outline during the divorce between the solicitors and the court. There have been circumstances where judges have adjourned court proceedings until an inheritance has been received so that it can be included in discussions and negotiations.
How do courts decide?
Legal professionals won’t just take the timeframe of an inheritance into consideration when making a decision on a settlement. How long you have been together, how long you have been married, whether you have children and any financial obligations post-divorce will all be taken into consideration to ensure a fair settlement for everyone involved.