EP 80: 5 Ways to Protect Inheritances and Gifts during Divorce

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Episode 80 of the Divorce and Your Money Show discusses How to Protect Your Inheritance and Gifts during Divorce.

If you are in the midst of a divorce proceeding, you want to protect gifts and inheritances from your spouse.  Therefore, it is important to understand the difference between Separate Property and Marital Property.  Separate Property is solely owned by you, while Marital Property is generally acquired during the marriage.

While each state has different laws, there are several ways to make sure your inheritances and gifts are your separate property:

  1. Keep inheritances and gifts in your name only.
  2. Do not let spouses make contributions towards any gift received. Perhaps you received a house in your name only from your parents, but your spouse contributed to a renovation. If so, they can claim some of the house’s value.
  3. You can transfer the inheritance or gift into a trust. Seek a qualified estate planner to help protect your assets using trusts.
  4. If divorce is eminent, determine the right time to tell your spouse about any planned inheritances. You must eventually disclose it in the Financial Disclosure document, but they may not have entitlements to it.
  5. Keep good records about where the inheritance came from, including any appreciation and modifications. Some states assume all property is marital, unless you keep appropriate records that prove it is separate (and has never been comingled).

Thank you for listening to the Divorce and Your Money Show. Visit us at www.divorceandyourmoney.com and be sure to check out the NEW course Divorce 101: Steps to Take Before Divorce.

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Shawn Leamon, MBA, CDFA

Dallas, Texas

Shawn C. H. Leamon is Managing Partner of LaGrande Global, a firm that helps successful families manage large financial transitions like divorce, inheritance and selling a business.

He earned his Bachelor of Arts from Dartmouth College, double majoring in Economics and Philosophy, and his Masters in Business Administration at Spain’s IE Business School.

Before founding LaGrande Global, Shawn helped manage $1.1 billion in client assets at Bernstein Global Wealth Management. He also worked as a credit research analyst at J.P. Morgan. He is a Certified Divorce Financial Analyst, and he has been an advisor to numerous high-stakes divorce cases.

Shawn is the author of two well-received finance books: Managing Private Wealth: Principles, and Divorce and Your Money: The No-Nonsense Guide, both published in 2016.

In his spare time, Shawn is an ultra-endurance athlete and has competed in events as long as 24 hours. He is an Eagle Scout and a member of the Alumni Board of Greenhill School.