No one ever expects to get divorced when they get married, but it happens to people every day in New York. A divorce may be something that blindsides you, not allowing you a chance to even prepare. It may also be something you feel strongly that you need to do. Whatever the case, if you find yourself facing a divorce, you may be concerned about what will happen with your trust fund.
The court will divide your marital property evenly and fairly. This might mean that one of you gets more assets than the other, but the value is key. However, some personal property is exempt from the property division in the divorce. This separate property is whatever you and you alone own. Your trust fund may fall into that category, but you need to plan ahead if you want to save it from your divorce. Here is a look at two ways Forbes says that you can protect your trust fund.
- Do not comingle
You should keep your trust fund money completely separate from your household money. Do not use it to help buy your home, pay for the electric bill or to do anything else associated with managing and upkeeping your marriage and home. You need to also avoid using any money from your trust fund to make joint purchases.
- Set the right terms
Make sure that before you marry your trust fund terms include wording that states this is money only for you and that it is not to become part of marital property should you marry. You need to make sure that it also is set up to not be used to figure alimony since you could end up having to pay your ex-spouse, which can eat up your trust fund.
Losing your trust fund in your divorce can be devastating. You want to avoid it at all costs, so make sure that you plan far ahead just in case your marriage ever comes to an end.