How Are Financial Investments Divided In A Divorce?

The financial investments are split according to the state law governing community property. The number of assets received during the course of the marriage is considered marital or community property and will be divided equally upon divorce.

Financial investments are excluded in a divorce if another arrangement is appointed in the postnuptial or prenuptial agreement or if those assets are the spouse’s property. A family law attorney in monroe nc can guide you through the process of division of financial investments. 

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How are financial investments divided in a divorce?

Financial investments are viewed as separate property when named in a postnuptial or prenuptial agreement or:

  1. Property gifted or inherited by one of the spouses during the marriage.
  2. Property owned by a spouse before marriage.
  3. Property bought with rents, proceeds, or monies from one spouse’s property.

Any changes in the value of the property resulting from the market shifting are also considered separate property. But, an increase in the value of individual property due to a spouse’s effort is considered to be community property.

Dividing financial investments

Not every financial investment division is practical. There are also some investments that suffer tax imports if split. Pension and retirement accounts typically need a pension administrator to draft the Qualified Domestic Relations Order before dividing funds between the spouses.

Spouses can split their marital estate equally, with one spouse taking the real property while the other spouse takes the financial assets. Regardless of the route decided, review the agreements by a legal professional for tax consequences and potential pitfalls.

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Vested and unvested stocks

Stocks depend on the day they vests and can be both separate and community property. Any part of a spouse’s unvested stock before marriage is considered individual property. However, any vested or unvested stock earned during marriage is known as marital property.

Dividing financial investments is complicated, and that is why you should hire an experienced divorce attorney who can assist you in apportioning the assets.

Date of separation

After the date of separation, if any investments are made will be considered separate property. Sometimes the date of separation can be when one spouse decides to leave the marital home. However, it depends upon the spouse’s action to end the marriage.

The actions can be financial, physical, or behavioral separation. If the spouses cannot decide the date of separation, the court will do it.