Gray divorce is on the rise in Colorado. As more and more couples choose to end their marriages later in life, the need for asset protection becomes increasingly important. If you are considering a gray divorce, it is crucial to take steps to protect your assets to avoid financial hardship down the road.
Keep good records
Be sure to keep track of all your assets, including bank accounts, investment accounts, real estate holdings and any other valuable property. One of the best ways to do this is to keep a folder or file with all of your important financial documents. This will come in handy if you need to prove ownership of any assets during the divorce process.
Get a postnuptial agreement
A postnuptial agreement is a contract that’s signed after you are married that outlines how your assets will get divided in the event of a divorce. To create a valid postnuptial agreement, both spouses must agree to the terms and sign the document. You should also consider having the agreement witnessed by a notary public.
Create a trust
With a trust, you can designate how your assets will get distributed after your death. You can also use a trust to protect your assets from creditors or lawsuits. One of the best types of trusts to use for asset protection is a revocable living trust. This type of trust allows you to change the terms at any time, which can be helpful if your circumstances change.
Keep your assets separate
If you want to protect your assets in a gray divorce, it is important to keep them in your own name. This means that you should not commingle your assets with your spouse’s. For example, if you have a bank account in your own name, do not add your spouse as a joint owner.
If you do not take steps to protect your assets in a gray divorce, you could end up losing a significant portion of your wealth. In some cases, one spouse may be ordered to pay alimony or give up ownership of property, such as the family home. You could also be forced to sell assets to pay for your spouse’s share of the marital debt. Therefore, it is crucial to take steps to protect your assets before embarking on a gray divorce.