A significant portion of your wealth is simply an inheritance that you received from your parents. For instance, maybe it’s enough money to retire. You haven’t used it for anything, but you’ve set it aside so that you know your financial future is secure.
But now you and your spouse are going through a divorce. Your spouse is claiming that they deserve to keep half of the inheritance. You’re worried that this is going to put your financial future in jeopardy as it ruins your plans to retire on those funds. Do you have to divide it?
How did you use it during the marriage?
Generally speaking, if the inheritance wasn’t specifically given to both you and your spouse, it starts as a separate asset. Your parents gave it to you, so you are the only one who owns it, and you do not have to divide it during property division.
But this can change if the inheritance is commingled. For instance, maybe you and your spouse have a shared retirement fund, and that’s where you kept the inheritance money. Your spouse could claim that they were given access to that fund or that they are a joint account holder, so commingling the inheritance means they have ownership rights, and it needs to be divided.
This can also happen if you use the money to make joint purchases. Instead of retiring, if you use the money to buy a home together, the home would still be a marital asset that you both own, not a separate asset just because it was purchased with the inheritance.
It can be complicated to determine how to divide significant assets during divorce. Be sure you fully understand all of your legal options.