Many well-intentioned people tend to give you lots of financial and strategic “advice” when going thru your divorce or separation. Unfortunately, the pearls of wisdom that are offered by friends or family are usually based on myth and not reality. Here are three simple truths you need to know when traversing thru your divorce.
Myth one: If you keep separate bank accounts during the marriage, the money that is deposited into that account is solely yours and your spouse is not entitled to any of it. The reality here is simple: In California, money earned during the marriage belongs to both spouses, no matter where it is deposited, even if it is deposited into an account in your own name. There is no getting around this absent a written prenuptial agreement.
Myth two: Your inheritance belongs to you no matter what you do with it. The truth on this one is that inheritances have to be treated very, very carefully. They cannot be “mixed” with any other money, like earnings, or other property, or else they could be deemed community property. If you get an inheritance, open a completely new and separate bank account and never deposit any additional funds into the account. You also need to keep meticulous records like the will or other inheritance document, a copy of the inheritance check, etc to preserve it as your separate property.
Myth three: Your spouse owns no interest in your house that you owned prior to marriage. This is false. If you use your or your spouses’ earnings during marriage to pay the mortgage or property taxes on your house you owned before marriage, your spouse may have an interest in that house depending on how much the mortgage was paid down. A Moore Marsden calculation will have to be performed to determine the extent of the community interest. People representing themselves or those who go to “document preparers” or “paralegals” are often ill equipped to determine the community interest, if any, in a separate property home.  Yes, these outfits may charge you less, but they cost you more in the end because of the loss of assets.  Divorce realities can be harsh, but they can be mitigated thru proper planning.
Denise Lite is a 2013-2015 SuperLawyer of the Year and one of Southern California’s Top Female Attorneys. For an appointment, call 877-317-8080. Your children and your future deserve the finest.