You’re thinking about divorce and wondering, who gets what? Maybe you’re worried about losing what you’ve worked hard for or drowning in conflicting advice. Someone told you that whatever you owned before marriage is yours, no questions asked. But is that really true? And what’s the scoop with “marital property states” and does it apply to you?
When it comes to your money, surprises are the last thing you need. So we’re breaking it down, answering your biggest questions, and making sure you walk away confident and informed. 👇
What’s the difference between marital and separate property?
At its core, divorce is about untangling two lives. That includes finances.
Marital property refers to anything you and your spouse acquired during your marriage, like homes, cars, bank accounts, investments, and even debts. If you obtained it while you were married, it’s generally considered joint property, no matter whose name is on the paperwork.
Separate property refers to anything you brought into the marriage or owned outright before you said “I do.” It generally covers inheritances, gifts given only to you, and some legal settlements. Generally, these stay yours, unless they’ve been mixed with marital assets (IE putting inheritance money into a joint account.)
What’s the difference between common law property and community property?
Where you live plays a huge role in how your assets are divided.
Common Law Property States: Most states follow common law property rules which means that anything purchased during the marriage belongs to the person whose name is on it. For example, if you buy a car in your name only, it’s yours. If you buy a car and put both names on the title, it’s assumed that you each own half.
These states are also called equitable distribution states which means that assets are generally divided equitably (fairly) not necessarily equally. This is an important distinction.
Community Property States: A small handful of states take a different approach. In these, anything earned or acquired during the marriage is owned equally by both spouses, no matter whose name is on it. That means in a divorce, usually everything (including retirement accounts and debts) gets split 50/50. *Click the link to see which state you are in!
How does property division actually work in divorce?
If you live in a community property state, all of your assets are shared equally and divided 50/50 in divorce. The only exceptions are gifts and inheritances received by one spouse during the marriage.
If you live in an equitable distribution state, things are more flexible. Instead of an automatic 50/50 split, courts consider factors like income, financial need, contributions to the marriage (including caregiving and homemaking!), and future earning potential in order to divide assets “fairly.” Fairly does not always mean equally.
Is there anything else I should know?
YES. Prenups and postnups can change how assets are divided.
A prenuptial agreement (prenup) is a legal contract made before marriage that outlines how assets and debts will be handled if the marriage ends. A postnuptial agreement (postnup) does the same thing, but is created after you’re already married. These agreements can protect separate property, clarify financial expectations, and help avoid costly disputes in divorce. If you have a prenup or postnup, it probably spells out exactly how things will be divided.
What should you do next?
If you have a prenup or postnup → It likely outlines exactly how your assets will be divided. It should include clear terms, definitions, and timelines to guide the process.
If you don’t have a prenup or postnup → Find a trusted professional—like an attorney, Certified Divorce Financial Analyst, or mediator—to review the specifics of your case, considering your unique situation and location. They’ll know the ins and outs of handling complex legal issues like inheritances, gifts, and investment accounts and will help you strategize and create a solid plan for moving forward.
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No matter where you are in this process, we are by your side, supporting you and celebrating you every step of the way!