Virtually no Louisiana couple prepares to marry with the belief that their union will someday come to an end. However, statistics show that divorce will be a reality for many couples, even those who thought that their marriage would last forever. In the event that one or both spouses is fortunate enough to receive an inheritance, those assets could be subject to loss during property division during a divorce. There are ways to prevent those losses, but it requires a degree of advance planning.
The best way to shield assets from loss during divorce is to draft a strong prenuptial agreement. A prenup can outline which assets would not be included in property division, and can include any number of specific terms to which the couple agrees. If a prenup was not put into place before the marriage began, then a postnuptial agreement can serve many of the same goals. Many people choose to create a postnup after they learn that they will receive an inheritance.
Another way to protect inherited wealth is to place those assets into a living trust. Once assets become part of a trust, the trust becomes the “owner” of the assets. The beneficiaries can still receive wealth from the trust, but the base of assets remains protected. In fact, there are cases where a loved one will only set up an inheritance when one or more of these protective measures is in place.
For those in Louisiana who are concerned about making wise financial decisions regarding an inheritance and property division, it can be helpful to schedule a consultation with a family law attorney who can answer questions and suggest various options. An inheritance is an expression of both love and trust. The intent behind such a gesture is for the recipient to use those assets to improve their life, not for a large portion of that wealth to be lost during property division.
Source: kiplinger.com, “Strategically Thinking About Divorce“, Andrew Bass, April 5, 2017