Sometimes people feel the need to protect their net worth from their partner. Perhaps there’s a great disparity between assets or income or this is a second marriage. Children from a previous union might be involved or one partner could own a business. Other times, there are trust issues.
Generally, whatever is accumulated during a marriage or a recognized common-law union is considered community property and would be divided equally during divorce and separation proceedings.
But, tools such as cohabitation and prenuptial agreements can be signed prior to joining households. These agreements define rights, obligations and how each partner wants to own their assets after the union ends.
Regardless of your personal view, take an inventory of all your assets prior to marriage or moving in.
Sometimes asset values (or entitlement) can get blurred through divorce and separation proceedings. By having a clear record of what you own and its value (use an appraiser if you need to and keep your receipts), asset values will be very clear.
The alternative to having a legal agreement is complying with divorce and separation laws, which can have some very unintended and uncontrollable outcomes.
Talk to your partner and your lawyer if you want to protect your assets. Open communication and teamwork will see you through these difficult conversations.
