Can the Trust in my Will protect my assets from a divorce?
One of the purposes of a Will is to protect your assets after your death; and whilst a properly planned Will-Trust is a valuable legal mechanism in protecting your assets against future events such as the remarriage of your spouse, it does not protect your assets during your lifetime. Therefore, as divorce is a lifetime event, a Will would not exclude any part of your estate from consideration as part of divorce proceedings.
How, then, can you seek to protect your assets from a potential divorce?
Assets accrued by an individual before marriage can be argued to be non-matrimonial, rather than matrimonial assets (upon which both spouses would have a claim). However, if your remaining matrimonial assets are not enough to fulfil your spouse’s needs, such as housing, your non-matrimonial assets can be used to meet the shortfall.
The only way to be certain your assets would not be considered matrimonial assets during future divorce proceedings, is, quite simply, by not owning them. This is, however, a drastic measure, which would place most people in a vulnerable position.
Some clients ask about gifting their property to their children but keeping a life interest (see previous blogpost explaining life interests) in the property, as a way of safeguarding their financial stability but without retaining having legal title to the property. Although this fundamentally changes your ownership of the property, your life interest would still be taken into consideration and attributed a value in divorce proceedings, against which other assets may be offset (depending on your spouse’s needs at that time).
For more certainty about the way in which assets would be divided in the event of a divorce, you can consider a prenuptial agreement (if you are yet to be married) or postnuptial agreement (if you have already married). Although such agreements are not entirely infallible (they are always subject to the needs of both parties at the time of proceedings and, most importantly of any children of the family), they do serve as strong evidence of the intentions of both spouses, whilst providing clarity as to what would and what wouldn’t be classed as matrimonial asset in the case of a divorce.
If you require expert advice on any of these matters, please contact us on 01202 802807 and ask for:
Our family law expert, Jacqui Forrest for specific advice on prenuptial or post nuptial agreements