How to Protect Your Assets Before Divorce

Protect Your Assets Before Divorce
Holly Hammersmith

By Holly Hammersmith | Jan 13th, 2021

No one really wants to plan to divorce. But if it may be on the horizon for you, a few simple steps can help you prepare for a smooth financial separation while protecting your assets. Start by examining current assets that may be affected by a divorce. File for an uncontested divorce without a Lawyer Today

Types of Assets Impacted by Divorce Include:

Here are a few simple tips to follow and consider when trying to protect your assets in a divorce:

Evaluate Separate Property

In divorce, your assets will be looked at and determined to be marital property or separate property. Evaluating these assets prior to divorcing can help you paint a picture of financial life after separation. Examples of separate property include any property owned by one spouse prior to marriage, an inheritance received by one partner, gifts from third parties to one partner; and payment received from a personal injury lawsuit. By identifying personal property, it will give you a better idea of which assets you will likely still have following divorce.

READ MORE: Selling Your Home In Divorce: What You Need to Know

Evaluate Marital Property

In addition, look at what “big ticket” items in your marriage count as marital property. Often these assets will be divided equally between partners. Knowing the value of accounts before filing papers can help you understand how finances will play out following divorce proceedings. When it comes to these so-called “shared” assets, the court will often consider many factors in determining how they will be divided, according to a report by Forbes. These factors often include:

Keep an Eye Out for Financial Fraud

While you may realize your marriage is heading for divorce, it’s an entirely different matter to intentionally hoard assets – also known as financial fraud. If you suspect your partner has committed financial fraud, a finance expert can help identify this fraud and make sure you receive fair and equal share of assets. This can be especially important for high-income couples.

Hidden or missing assets and misrepresentation of family income are two common areas of money manipulation that, if left undiscovered, can lead to a disproportionate share of the assets going to one spouse,” according to The Huffington Post. “The more money a divorcing person has, the more places it can be squirreled away out of sight.”

Hire an Expert in the Finances of Divorce

Hire an Expert in the Finances of Divorce

In addition to having an attorney to help protect and fight your personal assets during divorce, having a financial expert is essential. A Certified Divorce Analyst can help determine values of assets before division – including more complicated financial accounts such as retirement accounts. Some attorneys have this credential but not all have the extra training to help with evaluating complicated financial accounts. You can find a qualified professional through the Institute for Divorce Financial Analysts.

Be Careful About How Attorney Fees are Paid

Typically the largest fee associated with divorce comes down to legal fees. Borrow money from friends or family, or use a credit card to pay attorney fees. But, don’t raid retirement accounts. Another option? Selling your wedding band can help garner quick cash to pay for an attorney.

“If you cash out of a retirement fund like a 401(k) or IRA, you’ll owe a 10 percent early withdrawal penalty if you’re younger than 59½, plus income taxes. Then there’s the opportunity cost when you remove money that is compounding on a tax-deferred or tax-free basis,” according to a report by

Gather Records & Document Household Goods

If divorce is on the horizon for you, now is the time to begin gathering records for all jointly held accounts, properties and assets. Documentation will be vital in determining your fair share of assets, and can help prevent your partner from hiding tangible assets.

“Make a clear copy of all tax returns, loan applications, wills, trusts, financial statements, banking information, brokerage statements, loan documents, credit card statements, deeds to real property, car registrations, insurance inventories and insurance policies. Copy records that can trace and verify your separate property, such as an inheritance or family gifts,” according to Fidelity Investments.

In addition, now is the time to create an inventory of household goods and their value. From your big screen TV, to personal computers, to the dining room set. Values can be documented with receipts to show how much was paid for an item or by using an appraiser. Don’t forget about antiques and heirloom items. A professional can also appraise these items.

Look at Social Security Benefits

In addition to impacting retirement accounts, divorce can have an impact on Social Security benefits. If you are a woman over 50, you should be particularly attentive to this area when planning a divorce and determining your assets going forward. Your estimated Social Security benefits can be obtained online from the Social Security Administration. If your marriage lasted 10 years or more, and you are now 62 or older, you may be entitled to benefits from your partner, as long as you do not remarry and depending on your own income and past earnings.

Consult with an Expert

Consulting directly with a divorce lawyer and/or financial expert prior to filing for divorce can further help you identify and protect assets in a divorce. While it’s not possible to go back in time and create a prenuptial agreement now, these steps and tips can help you receive all you are entitled to following divorce

Holly Hammersmith

Holly Hammersmith

Holly Hammersmith is a Cleveland, Ohio-based freelance financial writer.


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